50 State Tax Survey: A — K
ALABAMA
LAW
Ala. Code §25-4-10
Employment.
(a) Subject to other provisions of this chapter, "employment" means:
(1) Any service performed prior to January 1, 1978, which was
employment as defined in this section prior to such date and, subject to
the other provisions of this section, services performed for remuneration
after December 31, 1977, including service in interstate commerce, by:
* * * * *
b. Any individual who, under the usual common law rules applicable in determining
the employer-employee relationship, has the status of an employee;.
ALASKA
LAW
Alaska Stat. § 23.20.525 "Employment'' Defined
(a) In this chapter, unless the context otherwise
requires, "employment" means
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(2) service performed by an individual who under
(10) of this subsection has the status of an employee;
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(10) service performed by an individual
whether or not the common-law relationship of master and servant
exists, unless and until it is shown to the satisfaction of the
department that
(A) the individual has been and will continue
to be free from control and direction in connection with the performance
of the service, both under the individual's contract for the performance
of service and in fact;
(B) the service is performed either outside the
usual course of the business for which the service is performed
or is performed outside of all the places of business of the enterprise
for which the service is performed; and
(C) the individual is customarily engaged in
an independently established trade, occupation, profession, or
business of the same nature as that involved in the service performed;
ARKANSAS
LAW
ARIZONA
LAW
Ariz. Rev. Stat. §23-613.01. Employee;
definition; exempt employment
A. "Employee" means any individual who performs services
for an employing unit and who is subject to the direction, rule
or control of the employing unit as to both the method of performing
or executing the services and the result to be effected or accomplished,
except employee does not include:
1. An individual who performs services as an independent contractor,
business person, agent or consultant, or in a capacity characteristic
of an independent profession, trade, skill or occupation.
2. An individual subject to the direction, rule or control or
subject to the right of direction, rule or control of an employing
unit solely because of a provision of law regulating the organization,
trade or business of the employing unit.
3. An individual or class of individuals that the federal government
has decided not to and does not treat as an employee or employees
for federal unemployment tax purposes.
4. An individual if the employing unit demonstrates the individual
performs services in the same manner as a similarly situated class
of individuals that the federal government has decided not to and
does not treat as an employee or employees for federal unemployment
tax purposes.
B. Notwithstanding this section, an individual or class of individuals
shall not be treated as an employee by the department for purposes
of this chapter if, before the department's determination that
the individual or class of individuals at issue is an employee:
1. The individual or class of individuals had been performing
services for the employing unit.
2. The department had inspected work records of the employing
unit for time periods that the individual or class of individuals
had been performing these services.
3. The individual or class of individuals at issue was not included
on the contribution and wage reports of the employing unit.
4. After its inspection the department concluded in writing provided
to the employing unit that either:
(a) No change or changes in the inspected reports were necessary.
(b) The individual or class of individuals in question did not
constitute an employee for purposes of this chapter.
5. At no time between the date of the written determination prescribed
in paragraph 4 of this subsection, and the department's subsequent
conclusion that the individual or class of individuals at issue
constitutes an employee, did the department notify the employing
unit in writing that the individual or class of individuals at
issue now constitutes an employee for purposes of this chapter.
C. Subsection B of this section shall not apply if either:
1. There has been a substantial and material change in the facts
upon which the writing required by subsection B, paragraph 4 of
this section was based.
2. The conclusion reached by the department pursuant to subsection
B, paragraph 4 of this section was the result of false statements,
misrepresentation, fraud or intimidation on the part of the employing
unit.
D. The following services are exempt employment under this chapter,
unless there is evidence of direction, rule or control sufficient
to satisfy the definition of an employee under subsection A of
this section, which is distinct from any evidence of direction,
rule or control related to or associated with establishing the
nature or circumstances of the services considered pursuant to
this subsection:
1. Services which are not a part or process of the organization,
trade or business of an employing unit and which are performed
by an individual who is not treated by the employing unit in a
manner generally characteristic of the treatment of employees.
2. Services performed by an individual for an employing unit through
isolated or occasional transactions, regardless of whether such
services are a part or process of the organization, trade or business
of the employing unit.
E. Notwithstanding this section, an individual or class of individuals
determined to be an employee or employees for purposes of the federal
unemployment tax act, as amended (26 United States Code sections
3301 through 3311), are employees under this chapter.
F. Notwithstanding any other provision of this chapter, this section
shall apply to an employing unit to which the provisions of section
23-750 apply only to the extent not inconsistent with the requirements
of 26 United States Code sections 3304 (A)(6) and 3309.
REGULATIONS
R6-3-1723. Employee defined
A. "Employee" means
any individual who performs services for an employing unit, and
who is subject to the direction, rule or control of the employing
unit as to both the method of performing or executing the services
and the result to be effected or accomplished. Whether an individual
is an employee under this definition shall be determined by the
preponderance of the evidence.
1. "Control" as used in A.R.S. § 23-613.01, includes the right to control as well
as control in fact.
2. "Method" is defined as the way, procedure or
process for doing something; the means used in attaining a result as distinguished
from the result itself.
B. "Employee" as
defined in subsection (A) does not include:
1. An individual who performs services for
an employing unit in a capacity as an independent contractor, independent
business person, independent agent, or independent consultant,
or in a capacity characteristic of an independent profession, trade,
skill or occupation. The existence of independence shall be determined
by the preponderance of the evidence.
2. An individual subject to the direction, rule, control or
subject to the right of direction, rule or control of an employing unit "....
solely because of a provision of law regulating the organization, trade or business
of the employing unit". This paragraph is applicable in all cases in which
the individual performing services is subject to the control of the employing
unit only to the extent specifically required by a provision of law governing
the organization, trade or business of the employing unit.
a. "Solely" means,
but is not limited to: Only, alone, exclusively, without other.
b. "Provision
of law" includes, but is not limited to: statutes, regulations, licensing
regulations, and federal and state mandates.
c. The designation
of an individual as an employee, servant or agent of the employing unit for purposes
of the provision of law is not determinative of the status of the individual
for unemployment insurance purposes. The applicability of paragraph (2) of this
subsection shall be determined in the same manner as if no such designated reference
had been made.
C. The following services
are exempt employment under this Chapter, unless there is evidence
of direction, rule or control sufficient to satisfy the definition
of an employee under subsection (A) of this Section, which is distinct
from any evidence of direction, rule or control related to or associated
with establishing the nature or circumstances of the services considered
pursuant to this subsection:
1. Services
by an individual for an employing unit which are not a part or process of the
organization, trade or business of the employing unit, and the individual is
not treated by the employing unit in a manner generally characteristic of the
treatment of employees.
a. Services
by an individual not treated by the employing unit in a manner generally characteristic
of the treatment of employees means the individual performing the services is
not treated by the employing unit in substantially the same manner as employees
of that employing unit.
b. The words "part" and "process" are
not synonymous. If the individual performs services which are either a part of
or process in the organization, trade or business, the conditions of this paragraph
are not met and the services cannot be exempt under this paragraph. "Process" refers
to those services which are directly responsible for carrying out the fundamental
purpose or purposes for which the organization, trade or business exists; e.g.,
painting and repairing automobile bodies in an automobile body paint and repair
shop. "Part" refers to any other services which are essential to the
operation or maintenance of the organization, trade or business; e.g., routine
cleaning of premises and maintenance of tools, equipment and building. In addition
to services which are a part of or process in the organization, trade or business,
there are those services which are for the purposes of the organization, trade
or business but are merely ancillary or incidental and are not essential or necessary
to the conduct of the organization, trade or business; e.g., landscaping area
around the automobile body paint and repair shop.
2. Services by an individual for an employing unit through isolated
or occasional transactions, regardless of whether such services
are a part or process of the organization, trade or business of
the employing unit.
a. The phrase "isolated or occasional" has its commonly
understood meaning. The intent of the relationship between the
employing unit and the individual performing the services is to
be considered with the intent of the parties being that it is on
a permanent basis or for a long period; e.g., an individual employed
who either quits or is discharged after a brief period of employment,
would not be considered an isolated or occasional transaction regardless
of how brief the period of employment may be.
b. An individual who performs services on less than thirteen days in a calendar
quarter will be presumed to be performing isolated or occasional transactions.
An individual who performs services on thirteen days or more in a calendar
quarter will be presumed not to be performing isolated or occasional transactions.
In all cases in which there is a standing or continuing arrangement with an
individual to perform required services on either a regularly scheduled basis
or on call as requested, it will be presumed the individual is not performing
isolated or occasional transactions.
D. In determining whether
an individual who performs services is an employee under the general
definition of subsection (A), all material evidence pertaining
to the relationship between the individual and the employing unit
must be examined. Control as to the result is usually present in
any type of contractual relationship, but it is the additional
presence of control, as determined by such control factors as are
identified in paragraph (2) of this subsection, over the method
in which the services are performed, that may create an employment
relationship.
1. The existence of control solely on the basis of the existence
of the right to control may be established by
such action as: reviewing written contracts between the individual
and the employing unit; interviewing the individual or employing
unit; obtaining statements of third parties; or examining regulatory
statutes governing the organization, trade or business. In any
event, the substance, and not merely the form of the relationship
must be analyzed.
2. The following are some common indicia of control over the method
of performing or executing the services:
a. Authority
over individual's assistants. Hiring, supervising, and payment
of the individual's assistants by the employing unit generally
shows control over the individuals on the job. Sometimes, one worker
may hire, supervise, and pay other workers. He may do so as the
result of a contract in which he agrees to provide materials and
labor and under which he is responsible only for the attainment
of a result; in which case he may be independent. On the other
hand, if he does so at the direction of the employing unit, he
may be acting as an employee in the capacity of a foreman for or
representative of the employer.
b. Compliance
with instructions. Control is present when the individual is required to comply
with instructions about when, where and how he is to work. Some employees may
work without receiving instructions because they are highly proficient in their
line of work and can be trusted to work to the best of their abilities; however,
the control factor is present if the employer has the right to instruct or
direct. The instructions may be oral or may be in the form of manuals or written
procedures which show how the desired result is to be accomplished.
c. Oral or written reports. If regular oral or written reports bearing upon
the method in which the services are performed must be submitted to the employing
unit, it indicates control in that the worker is required to account for his
actions. Periodic progress reports relating to the accomplishment of a specific
result may not be indicative of control if, for example, the reports are used
to establish entitlement to partial payment based upon percentage of completion.
Completion of forms customarily used in the particular type of business activity,
regardless of the relationship between the individual and the employing unit,
may not constitute written reports for purposes of this factor; e.g., receipts
to customers, invoices, etc.
d. Place
of work. Doing the work on the employing unit's premises is not
control in itself; however, it does imply that the employer has
control, especially when the work is of such a nature that it could
be done elsewhere. A person working in the employer's place of
business is physically within the employer's direction and supervision.
The fact that work is done off the premises does indicate some
freedom from control; however, it does not by itself mean that
the worker is not an employee. In some occupations, the services
are necessarily performed away from the premises of the employing
unit. This is true, for example, of employees in the construction
trades, or employees who must work over a fixed route, within a
fixed territory, or at any outlying work station.
e. Personal
performance. If the services must be rendered personally it indicates that
the employing unit is interested in the method as well as the result. The employing
unit is interested not only in getting a desired result, but, also, in who
does the job. Personal performance might not be indicative of control if the
work is very highly specialized and the worker is hired on the basis of his
professional reputation, as in the case of a consultant known in academic and
professional circles to be an authority in the field. Lack of control may be
indicated when an individual has the right to hire a substitute without the
employing unit's knowledge or consent.
f. Establishment
of work sequence. If a person must perform services in the order of sequence
set for him by the employing unit, it indicates the worker is subject to control
as he is not free to follow his own pattern of work, but must follow the established
routines and schedules of the employing unit. Often, because of the nature
of an occupation, the employing unit does not set the order of the services,
or sets them infrequently. It is sufficient to show control, however, if the
employing unit retains the right to do so.
g. Right to discharge. The right to discharge, as distinguished from the right
to terminate a contract, is a very important factor indicating that the person
possessing the right has control. The employing unit exercises control through
the ever present threat of dismissal, which causes the worker to obey any instructions
which may be given. The right of control is very strongly
indicated if the worker may be terminated with little or no notice, without
cause, or for failure to use specified methods, and if the worker does not
make his services available to the public on a continuing basis. An independent
worker, on the other hand, generally cannot be terminated as long as he produces
an end result which measures up to his contract specifications. Many contracts
provide for termination upon notice or for specified acts of nonperformance
or default, and may not be indicative of the existence of the right to control.
Sometimes, an employing unit's right to discharge is restricted because of
a contract with a labor union or with other entities. Such a restriction does
not detract from the existence of an employment relationship.
h. Set hours of work. The establishment of set hours of work by the employing
unit is a factor indicative of control. This condition bars the worker from
being master of his own time, which is a right of the independent worker. Where
fixed hours are not practical because of the nature of the occupation, a requirement
that the worker work at certain times is an element of control.
i. Training.
Training of an individual by an experienced employee working with him, by required
attendance at meetings, and by other methods, is a factor of control because
it is an indication that the employer wants the services performed in a particular
method or manner. This is especially true if the training is given periodically
or at frequent intervals. An independent worker ordinarily uses his own methods
and receives no training from the purchaser of his services.
j. Amount
of time. If the worker must devote his full time to the activity
of the employing unit, the employing unit has control over the
amount of time the worker spends working and, impliedly, restricts
him from doing other gainful work. An independent worker, on the
other hand, is free to work when and for whom he chooses. Full
time does not necessarily mean an 8-hour day or a 5-or 6-day week.
Its meaning may vary with the intent of the parties, the nature
of the occupation and customs in the locality. These conditions
should be considered in defining "full time". Full-time
services may be required even though not specified in writing or
orally. For example, a person may be required to produce a minimum
volume of business which compels him to devote all of his working
time to that business, or he may not be permitted to work for anyone
else, and to earn a living he necessarily must work full time.
k. Tools
and materials. The furnishing of tools, materials, etc. by the employing unit
is indicative of control over the worker. When the worker furnishes the tools,
materials, etc., it indicates a lack of control, but lack of control is not
indicated if the individual provides tools or supplies customarily furnished
by workers in the trade.
l. Expense
reimbursement. Payment by the employing unit of the worker's approved business
and/or traveling expenses is a factor indicating control over the worker. Conversely,
a lack of control is indicated when the worker is paid on a job basis and has
to take care of all incidental expenses. Consideration must be given to the
fact some independent professionals and consultants require payment of all
expenses in addition to their fees.
E. Among the factors to be considered
in addition to the factors of control, such as those identified in subsection
(D), when determining if an individual performing services may be independent
when paragraph (1) of subsection (B) is applicable, are:
1. Availability
to public. The fact that an individual makes his services available
to the general public on a continuing basis is usually indicative
of independent status. An individual may offer his services to
the public in a number of ways. For example, he may have his own
office and assistants, he may display a sign in front of his home
or office, he may hold a business license, he may be listed in
a business directory or maintain a business listing in a telephone
directory, he may advertise in a newspaper, trade journal, magazine,
or he may simply make himself available through word of mouth,
where it is customary in the trade or business.
2. Compensation on job basis. An employee is usually, but not always, paid
by the hour, week or month; whereas, payment on a job basis is customary where
the worker is independent. Payment by the job may include a predetermined lump
sum which is computed by the number of hours required to do the job at a fixed
rate per hour. Payment on a job basis may involve periodic partial payments
based upon a percent of the total job price or the amount of the total job
completed. The guarantee of a minimum salary or the granting of a drawing account
at stated intervals, with no requirement for repayment of the excess over earnings,
tends to indicate that existence of an employer-employee relationship.
3. Realization
of profit or loss. An individual who is in a position to realize a profit or
suffer a loss as a result of his services is generally independent, while the
individual who is an employee is not in such a position. Opportunity for profit
or loss may be established by one or more of a variety of circumstances; e.g.:
a. The individual has continuing and recurring significant liabilities or obligations
in connection with the performance of the work involved, and success or failure
depends, to an appreciable degree, on the relationship of receipts to expenditures.
b. The individual agrees to perform specific jobs for prices agreed upon in
advance, and pays expenses incurred in connection with the work, such as wages,
rents or other significant operating expenses.
4. Obligation. An employee usually has the right to end his relationship
with his employer at any time he wishes without incurring liability, although
he may be required to provide notice of his termination for some period in
advance of the termination. An independent worker usually agrees to complete
a specific job. He is responsible for its satisfactory completion and would
be legally obligated to make good for failure to complete the job, if legal
relief were sought.
5. Significant investment. A significant investment by a person in facilities
used by him in performing services for another tends to show an independent
status. On the other hand, the furnishing of all necessary facilities by the
employing unit tends to indicate the absence of an independent status on the
part of the worker. Facilities include equipment or premises necessary for
the work, but not tools, instruments, clothing, etc., that are provided by
employees as a common practice in their particular trade. If the worker makes
a significant investment in facilities, such as a vehicle not reasonably suited
to personal use, this is indicative of an independent relationship. A significant
expenditure of time or money for an individual's education is not necessarily
indicative of an independent relationship.
6. Simultaneous contracts. If an individual works for a number of persons or
firms at the same time, it indicates an independent status because, in such
cases, the worker is usually free from control by any of the firms. It is possible,
however, that a person may work for a number of people or firms and still be
an employee of one or all of them. The decisions reached on other pertinent
factors should be considered when evaluating this factor.
F. Whether
the preponderance of the evidence is being weighed to determine
if the individual performing services for an employing unit is
an employee under the general definition of employee contained
in subsection (A), or may be independent when paragraph (1) of
subsection (B) is applicable, the factors considered shall be weighed
in accordance with their appropriate value to a correct determination
of the relationship under the facts of the particular case. The
weight to be given to a factor is not always constant. The degree
of importance may vary, depending upon the occupation or work situation
being considered and why the factor is present in the particular
situation. Some factors may not apply to particular occupations
or situation, while there may be other factors not specifically
identified herein that should be considered.
G. An
individual is an employee if he performs services which are subject to the
Federal Unemployment Tax Act or performs services which are required by federal
law to be covered by state law.
COURT DECISIONS
Fullerton v. Ariz. Dept. of Economic Security, 661 P.2d
210 (Ariz. App. 1983). Applying the common law test, the
court concluded that certain process servers were independent contractors.
See also:
Dial-A-Messenger, Inc. v. Ariz. Dept. of Economic Security,
648 F.2d 1053 (Ariz. App. 1982) (parcel delivery drivers); Smith
v. Ariz. Dept. of Economic Security, 623 P.2d 810 (Ariz App.
1980) (truckers).
Ark. Stat. § 11-10-210
- Employment
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(e) Service performed by an individual for wages shall be
deemed to be employment subject to this chapter irrespective of
whether the common law relationship of master and servant exists,
unless and until it is shown to the satisfaction of the director
that:
(1) Such individual has been and will continue to be free
from control and direction in connection with the performance of
the service, both under his or her contract for the performance
of service and in fact; and
(2) The service is performed either outside the usual course
of the business for which the service is performed or is performed
outside of all the places of business of the enterprise for which
the service is performed; and
(3) The individual is customarily engaged in an independently
established trade, occupation, profession, or business of the same
nature as that involved in the service performed.
CALIFORNIA
LAW
Unemployment Insurance Code
§621. "Employee" means all
of the following:
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(b) Any individual who, under the usual common law
rules applicable in determining the employer-employee relationship,
has the status of an employee.
REGULATIONS
Cal. Admin. Code tit. 22
§ 4304-1. Employee Defined, Rules Generally Applicable
to Determinations of Employment.
Whether an individual is an employee for the purposes of Sections
621(b) and 13020 of the code will be determined by the usual common
law rules applicable in determining an employer-employee relationship.
Under those rules, to determine whether one performs services for
another as an employee, the most important factor is the right
of the principal to control the manner and means of accomplishing
a desired result. If the principal has the right to control the
manner and means of accomplishing the desired result, whether or
not that right is exercised, an employer-employee relationship
exists. Strong evidence of that right to control is the principal's
right to discharge at will, without cause.
(a) If it cannot be determined whether
the principal has the right to control the manner and means of
accomplishing a desired result, the following factors will be taken
into consideration:
(1) Whether
or not the one performing the services is engaged in a separately established
occupation or business.
(2) The kind of occupation, with
reference to whether, in the locality, the work is usually done under the direction
of a principal without supervision.
(3) The skill required in performing
the services and accomplishing the desired result.
(4) Whether the principal or the
person providing the services supplies the instrumentalities, tools, and the
place of work for the person doing the work.
(5) The length of time for
which the services are performed to determine whether the performance is an
isolated event or continuous in nature.
(6) The method of payment,
whether by the time, a piece rate, or by the job.
(7) Whether or not the work
is part of the regular business of the principal, or whether the work is not
within the regular business of the principal.
(8) Whether or not the parties
believe they are creating the relationship of employer and employee.
(9) The extent of actual control
exercised by the principal over the manner and means of performing the services.
(10) Whether the principal is or is not
engaged in a business enterprise or whether the services being performed are
for the benefit or convenience of the principal as an individual.
(b) The
factors enumerated in (a) above are indicia of the right to control.
Where there is independent evidence that the principal has the
right to control the manner and means of performing the service
in question it is not necessary to consider the above enumerated
factors. When those factors are considered, a determination of
whether an individual is an employee will depend upon a grouping
of factors that are significant in relationship to the service
being performed.
For personal
income tax withholding purposes only, whether an individual provides equipment
in the performance of services for remuneration shall not be Considered in a
determination of whether that individual is an employee.
(1) Instrumentalities and facilities. Whether
the principal or worker provides the instrumentalities or facilities necessary
to accomplish the work would have little relevance if those instrumentalities
are not significant in nature. Examples are hand tools commonly provided by
workers or an automobile for personal transportation. On the other hand, if
they were of substantial value and supplied by the principal it would indicate
that the principal had the right to control the manner and means of their use
and that the worker would follow a principal's direction in the use of such
valuable instrumentalities if the principal chose to give such directions.
Similarly, if the facilities are of an intangible nature or unavailable except
through the principal, such as a trade name, office facilities, advertising,
merchandise, inventory, or communications, the worker would also be presumed
to use such facilities in a way specified by the principal if the principal
so chose to specify so that the worker can insure their continued use and availability.
(2) Effect of custom. Unskilled labor is
usually supervised and persons performing services, which require little or
no skill or experience are customarily regarded as employees. Even where skill
is required, such as an artisan, and the services are an incident of the business
of the principal, the principal would usually be considered to have the right
to control the manner and means of performing the service
incident to its business, and the worker would be considered an employee. On
the other hand, if the service of the artisan, such as a plumber, were engaged
to repair the plumbing for an insurance company in the company's office facilities,
the manner and means of performing services would not normally be controlled
by persons in the insurance company's offices.
(3) The period of employment and
method of payment. If the time in which the service is performed is short,
the worker is less apt to subject himself to control as to details of performing
the service. This is especially true if the payment is to be made by the job
and not by the hour, commission, or piece rate. On the other hand, if the work
is not skilled, and the principal supplies the instrumentalities necessary
to perform the work, and it is an integral part of the principal's business
activity, the worker would be an employee even though the time period was short
and the payment was by the job. If the services are performed on a continuing
basis it would be evidence of employment, especially if the services are a
regular part of the principal's business. The time of performing the service
and the method of payment may result in strong evidence of employment if the
performance and payment occur during regular intervals at regular times and
payment is in regular amounts.
(4) Control of the premises. If the services
are performed upon the premises of the principal who is in business and the
worker uses the facilities of the principal in performing the services in compliance
with policies or regulations for the conduct of workers on the premises, the
worker would be an employee. On the other hand, if the rules are made only
for the general safety, or security of the premises, and do not relate to the
manner and means of performing the actual service in question, adherence to
such rules would not raise the inference that the worker is an employee and
the relationship would depend on other factors. Similarly, if the worker has
only agreed to accomplish a desired result, rules or policies for the handling
of the result upon completion, such as distribution, storage, transportation,
or display, will not raise the inference that the worker is an employee.
(5) Belief of the parties. The terminology used
in an agreement between a principal and a worker is not conclusive of the relationship,
even in the absence of fraud or mistake. On the other hand, such an agreement
is evidence of the relationship intended by the parties to the agreement. If
the agreement provides for a relationship in which services are to be performed
for a principal in such a way that the principal expresses an interest only
in the desired result and abandons the right to control the manner and means
by which the result is achieved, such an agreement is evidence that the relationship
intended was not that of employer and employee if the terms of the agreement
are in fact carried out. If the factual relationship between the parties is
different than that provided by the agreement, an inference will arise that
the agreement does not express the intention of the parties and an employer-
employee relationship does in fact exist. If an agreement between a worker
and a principal specifically denies an employment relationship, but contains
provisions which allow for the exercise of control by the principal over the
manner and means of performing the service, the provision that an employment
relationship does not exist does not express the intent of the parties that
their relationship is one of independent contractors.
(6) Services performed as a part of the
regular business of the principal. Since for the purposes of these regulations,
employment is only significant where remuneration (wages) is paid for services
performed, employment will generally occur where the principal
is in business. In some situations, employment may occur where there is no
business activity of the principal, but it is presumed that those occasions
will be rare.
If the principal is in business and the services performed are
a regular part of the business of the principal, it is evidence
that the services are performed in employment. It is presumed that
if the principal is in business, he has the right to control the
manner and means by which services in that business are performed
as an incident to the principal's right to protect his business
interests. There must be a strong showing that the principal has
abandoned that right to overcome the evidence of employment under
those circumstances. For example, if the principal is in the business
of selling insurance, and an individual performs services for remuneration
selling insurance, it is evidence that those insurance sales services
are in employment. On the other hand, if the principal is in the
business of selling insurance and the services are performed by
a plumber fixing the pipes in the insurance company's office facilities,
it is not evidence that the services of the plumber are performed
in the employ of the insurance sales company.
(7) Separately established occupation or business.
If the person performing services for the principal is not in a separately
established occupation or business it will be evidence that the services are
performed in employment. If the individual performing the services does not
have an independently established occupation or business, and the services
are a regular part of the business of the principal, it will be presumed that
the services are performed in employment. Evidence that an occupation or business
is separately established is that the individual holds himself or herself out
to the general public or a significant segment of the business community, in
some readily identifiable way, as ready to perform services similar to those
performed for the principal at or about the same time as they are being performed
for the principal in the normal course of the independently established occupation
or business. A readily identifiable way to hold oneself out as in an independently
established occupation or business would include the name of the person or
the person's business name in media advertising, commercial telephone listing,
signs or displays on vehicles or premises, or brochure.
§ 4304-11. Specific Application of Rules for Determination
of Employment Status
to Circumstances in the Process Server's Industry.
(a) To determine whether services are performed
as an employee or independent contractor, refer to the common law rules contained
in Section 4304-1 of these regulations. Section 4304-1 provides that "to
determine whether one performs services for another as an employee, the most
important factor is the right of the principal to control the manner and means
of accomplishing a desired result." Section 4304-1 lists factors that
are evidence of the existence or absence of the right of control to be considered
when making an employment determination. Section 4304-11 provides standards
to be used when applying the common law rules specifically to process servers
and is intended to make clearer those circumstances under which a process server
is an independent contractor or employee.
(b) Definitions:
For the purposes of this regulation, the following definitions will apply:
(1) A "process" is
any means used by the court to acquire or exercise its jurisdiction
over a person or over specific property.
(2) A "service" as
used in the context of Service of Process is the exhibition or delivery
of a legal document such as a writ, summons and complaint, criminal summons,
notice, or order, by an authorized person, to a person who is thereby officially
notified of some action or proceeding in which he or she is concerned, and is
thereby advised or warned of some action or step which he or she is commanded
to take or to forbear.
(3) A "process
server" is a person authorized by law to serve process papers
on an individual or entity.
(4) A "principal" is
any individual or entity for whom or for which the process server performs process
serving services.
(c) Determination Factors:
To determine whether one performs services for another as an employee, the
most important factor is whether or not the principal has the right to control the
manner and means of accomplishing a desired result. Each of the following factors
shall be used to determine if an employment relationship exists. Not all factors
listed in this section (4304-11) are necessary to make a determination that
a particular relationship exists. A determination of whether services are being
performed as an employee or independent contractor will depend upon a grouping
of the factors that are significant in relationship to the services being performed.
(See following factors.)
TABLE OF DETERMINATION FACTORS-PROCESS SERVERS
|
FACTORS |
EVIDENCE OF
EMPLOYEE |
INDEPENDENT
CONTRACTOR |
WEIGHT |
|
(1) Policies, Rules or Procedures of Conduct. |
Set by the principal as evidenced by written or verbal instructions
necessary as to the details (manner and means) or methods
to serve a process. For example, the principal provides a
manual for the process server to establish procedures or
rules for dealing with various situations when performing
a service, such as better ways of performing service. |
The process server performs his or her services independent
of any policies, rules or procedures of conduct (other than
compliance with state and federal statutes or rules of court)
when service process. |
The setting of policies, rules, procedures and instructions
by the principal is an indication of direction and control
over the process server's services and carries great weight.
Conveying instructions and/or requirements received from
the client would not, by itself, be an indication of employment. |
|
(2) Supervision on the Job. |
The process server is subject to supervision from the principal. The
principal reviews the work performance as to how the process
server conducts himself or herself on the job. For example,
the principal requires the process server to report on the
progress of his or her work on a daily basis. The process
server is instructed by the principal on how to handle problems
encountered while service a process. |
Details (manner and means) of the work are not subject to
supervision by the principal. The process server is on his
or her own to perform the service using any method they choose
consistent with the direction of the client and in compliance
with state and/or federal statutes. The process server
may be required to provide a report of activities to the
court, to substantiate a diligent attempt to serve process.
The principal may review completed assignments to verify
that the client's instructions, court rules and statutes
were followed. |
To the extent that the principal exercises control over
the work through supervision, it is evidence that the principal
has the right to control the work, and that this right
to control the work is complete and authoritative.
This right to control (whether or not exercised) carries
the greatest weight in making an employer-employee determination. |
|
(3) Reporting into the Office and/or Contacting
the Principal. |
The principal requires the process server to report into
the office in person or by phone on a routine basis. The
process server reports into the office for new assignments
or to get directions or instructions. He or she must notify
the principal if he or she is sick, unable to work, or if
problems arise while serving process. |
The process server is not required to report into the office.
The process server performs services when he or she chooses.
The process servers are on their own performing the services
and the principal does not direct or instruct them in any
way. Failure to report to work or contact the principal does
not result in any adverse action taken against the process
serve although there can be instances where failure to go
into the office results in loss of assignments. |
Requirements placed on process servers by the principal
are indications of direction and control and carry great
weight. Requiring a process server to report into the office
in person or by phone on a routine basis restricts the process
server from making independent business decisions regarding
his or her business operations. |
|
(4) Reports |
The principal requires the process server to submit reports
regarding the service of process. (For example, reports
regarding the process server's daily activities.) Failure
of the process server to submit reports would result in adverse
action taken by the principal, such as the withholding of
commissions or termination. |
|
|
|
(5) Training. |
Training is provided to inexperienced process servers by
the principal. The principal instructs the worker on
details of the job, company policies or rules. The principal
places the process server with an experienced process server
for on-the-job training. |
Training is not provided. Attendance at training is no required. Process
server is not paid for time at training. |
The act of holding informational meetings to communicate
the requirements of statutory and court rules, by itself,
does not indicate employment or independence. However,
if by intent or fact the purpose of the meeting is to convey
policies, rules, procedures or instructions, it implies that
the process servers are no t in control of their services
and not independent. This should carry great weight. |
|
(6) Meetings. |
The principal conducts meetings and the process server's
attendance is required or expected. The principal pays the
process server for his or her time spent at meetings. |
The principal does not hold mandatory meetings. Attendance
at meetings is not required and nonattendance is viewed
without negative consequence. |
The act of holding informational meetings to communicate
the requirements of statutory and court rules, by itself,
does not indicate employment or independence.
However, if by intent or fact the purpose of the meeting
is to convey policies, rules, procedures or instructions,
it implies that the process servers are not in control of
their services and not independent. This should carry great
weight. |
|
(7) Principal and Process Server Contract. |
Agreement between the principal and the process server gives
the principal the right to direct and control the manner
and means of accomplishing the work. Agreement contemplates
that the process server will perform the services personally. |
The agreement forbids the principal from directing the process
servers as to the details (manner and means) of accomplishing
the work. The process server holds the principal; harmless
by indemnifying the principal for losses. Agreement
contemplates the process server is an independent contractor.
An agreement in which the principal expresses only an interest
in the end result and abandons the right to control the
details (manner and means) of the work is evidence of independence. |
Terminology used in a written agreement is not conclusive
of the relationship, but is evidence of the relationship
intended. Written agreements do not necessarily depict the
action practices of the parties in a relationship. The
actual practices of the parties in a relationship are more
important that he working of an agreement in making an employer-employee
relationship determination. |
|
(8) Termination. |
Both the principal and the process server have the right
to terminate the relationship at will, without prior notice
or without cause, and without any further contractual liability
(except for work already performed). |
By agreement or practice, the principal is required to pay
for work not performed if the principal unilaterally terminates
the relationship, other than for cause. The contract makes
the process server liable for damages if he or she fails
to complete the terms of the contract for reasons other than
good cause. |
The right to terminate conveys an inherent power of the
principal over the process serve. The right to terminate
at will, without cause, is strong evidence of employment.
The right to server the working relationship without notice
for breaches of statutory of regulatory requirements for
the protection of the public or for a material breach by
the process server is not evidence of employment. |
|
(9) Engagement in a Distinct Business. |
The process server does not operate his or her own business.
Work performed is a direct and essential part of the principal's
business. The process server does not advertise his or her
services to the general public as a separate business. The
process server performs services under the principal's business
name. This includes signing the proof of service with the
principal's name on it. The principal handles the billings
and collections. The principal provides insurance coverage.
The process server is prohibited from providing services
for others wile performing services for the principal. The
principal is responsible for arranging for a substitute
if the process server is unable to perform the services.
The process server does not have an entrepreneurial risk
of loss. |
The process server operates an independent business separate
form that of the principal. The process server advertises
under his or her own trade name, has a certificate of registration,
surety bond, and business license where required. The process
server provides his or her own insurance. If necessary, the
process server arranges for his or her own substitute if
he or she is unable to complete the services. Billings between
the principal and the worker are independent, separate and
apart from any other contractual obligations of the principal
or the process server. Payment of services by the process
server is contingent upon his or her fulfilling the requirements
of the contract. The process server is not prohibited by
the principal from providing services for others when performing
services for the principal and is free to make business decisions
which influence future profit and loss. The process serve
assumes an entrepreneurial risk of loss. (For example, a
process server is paid to serve a process. He or she is paid
the same amount regardless of the number of attempts needed
to complete the service. Therefore, there may be instances
where the costs exceed the payment for serving the process,
thereby resulting in a loss.) |
In spite of the fact that both the process server and the
principal work in the general area of process serving, if
the process server has established a separate, business,
distinct from that of the principal, great weight would
be given toward independence. If the process server does
not have an established separate business in the field of
process serving, distinct from that of the principal, great
weight would be given towards an employment relationship
since the work is an integral part of the regular business
of the principal. |
|
(10) Required Level of Skill of the Process
Server. |
Little or no experience is required. No particular education
is needed. |
The process server is required to serve process under
the most difficult situations and, as a result, he or she
must possess a greater amount of skill and expertise. |
Level of skill, by itself, generally does not weight heavily
toward independence. However, a high level of skill will
weigh more heavily when combined with other factors such
as separate and distinct business. A low level of skill weighs
in favor of employment, since as skill level
declines, the worker has less room to exercise the discretion
necessary for independent. |
|
(11) Duration of Services. |
The process server performs services on a continuous basis. |
The process server provides services on a sporadic, per
job basis. |
Generally, independent contractors perform work on a job
basis for shorter, designated periods of time. Employment
is usually of open-ended duration. A long series
of short term assignments from a single principal will tend
to show continuity and employment but will
not, by itself, be conclusive when each assignment was separate
for purposes of billings and performance expectations. However,
where a process server performs services for multiple principals
on a continuous basis, that is evidence of independence. |
|
(12) Whether the Principal or the Process
Server Supplies the Instrumentalities, Tools, and Place
of Work. |
The principal provides the process server with the supplies
and equipment to perform the services, such as business cards,
a beeper, telephone, or an automobile. The process
server is expected to spend time in the principal's office. |
The process server pays for his or her own car, office,
equipment, support services, forms, supplies and business
cards. |
If the process server has established his or her own office,
and pays all the expenses connected with that separate office,
there is a strong indication of independent. On the other
hand, if the process server generally works out of the principal's
office where all necessities are provided and paid for by
the principal, then there is a strong indication of an employment relationship.
If the principal provides a place for the process server
to wait until an assignment is received, that would be considered
a neutral factor. The neutrality of this factor is contingent
on the principal providing the waiting area for the convenience
of the process server only. There can be no requirement by
the principal that the process server use the waiting area
at any time. |
|
(13) Custom in Industry
and Location. |
Principals treat their process servers as employees. |
Process servers typically operate their own separately established
businesses. |
Industry custom merely gives an inference or director to
the determination. The fact that the principal may utilize
the services of both employee and independent contractor
process servers is not an indication of employment. |
|
(14) Method of Payment. |
Payment by the hour or piece rate. Compensation set by the
principal. Benefits are furnished at no cost to the process
server. The principal reimburses the process server for his
or her business expenses. |
The fees are negotiated including hourly fees for specific
assignments, such as stake-outs. The process server pays
for his or her own expenses. The principal furnishes no benefits
to the process server. The principal may reimburse or advance
fees, such as filing fees and witness fees provided for by
statute, on behalf of the client. |
This factor is only an indication of the type of relationship. A
process server may be paid solely by the job, but the controls
are sufficient to create an employer-employee relationship. A
process server could also be paid at regular intervals but
because the controls are not sufficient, no employer-employee
relationship would exist. The advancing of witness or filing
fees (statutory or other payments) by the principal, on behalf
of the client or the process serve would not be indicative
of employment. |
|
(15) Belief of Parties. |
Both parties believe the relationship is one of employment. |
Both parties agree that the relationship is one of independence. |
The belief of the parties only implies the intent of the
relationship. |
Administrative decision
In the Matter of Anthony _______ (________Messenger), Case
Nos. AO-39853 and AO-42848 (Unempl. Ins. App. Bd., Sept. 6, 2001): Independent
contractor couriers were adequately distinguished from employees
by furnishing their own vehicles and insurance, ability to choose
work hours and to work for others, ability to substitute, and requirement
of 30 days' notice before termination.
COLORADO
LAW
Colo. Rev. Stat. §8-70-115. Employment - "Federal
Unemployment Tax Act".
Statute text
(1) (a) "Employment", subject to other
provisions of this subsection (1), includes any service performed
prior to January 1, 1972, which was employment as defined in this
subsection (1) prior to such date and service performed after December
31, 1971, by an employee as defined in section 3306 (i) of the "Federal
Unemployment Tax Act" and any service performed after December
31, 1977, by an employee, as defined in subsection (o) of section
3306 of the "Federal Unemployment Tax Act", including
service in interstate commerce.
(b) Notwithstanding any other provision of this
subsection (1) and notwithstanding the provisions of section 8-80-101,
service performed by an individual for another shall be deemed
to be employment, irrespective of whether the common-law relationship
of master and servant exists, unless and until it is shown to the
satisfaction of the division that such individual is free from
control and direction in the performance of the service, both under
his contract for the performance of service and in fact; and such
individual is customarily engaged in an independent trade, occupation,
profession, or business related to the service performed. For purposes
of this section, the degree of control exercised by the person
for whom the service is performed over the performance of the service
or over the individual performing the service, if exercised pursuant
to the requirements of any state or federal statute or regulation,
shall not be considered.
(c) To evidence that such individual is engaged
in an independent trade, occupation, profession, or business and
is free from control and direction in the performance of the service,
the individual and the person for whom services are performed may
either show by a preponderance of the evidence that the conditions
set forth in paragraph (b) of this subsection (1) have been satisfied,
or they may demonstrate in a written document, signed by both parties,
that the person for whom services are performed does not:
(I) Require the individual to work exclusively
for the person for whom services are performed; except that the
individual may choose to work exclusively for the said person for
a finite period of time specified in the document;
(II) Establish a quality standard for the individual; except
that such person can provide plans and specifications regarding
the work but cannot oversee the actual work or instruct the individual
as to how the work will be performed;
(III) Pay a salary or hourly rate but rather a fixed
or contract rate;
(IV) Terminate the work during the contract period unless
the individual violates the terms of the contract or fails to produce
a result that meets the specifications of the contract;
(V) Provide more than minimal training for the individual;
(VI) Provide tools or benefits to the individual; except
that materials and equipment may be supplied;
(VII) Dictate the time of performance; except that a completion
schedule and a range of mutually agreeable work hours may be established;
(VIII) Pay the individual personally but rather makes checks
payable to the trade or business name of the individual; and
(IX) Combine his business operations in any
way with the individual's business, but instead maintains such
operations as separate and distinct.
(d) A document may satisfy the requirements
of paragraph (c) of this subsection (1) if such document demonstrates,
by a preponderance of the evidence, the existence of such factors
listed in subparagraphs (I) to (IX) of paragraph (c) of this subsection
(1) as are appropriate to the parties' situation.
(2) Where the parties use a written document
pursuant to paragraph (c) of subsection (1) of this section, such
document may be the contract for performance of service or a separate
document. Such document shall create a rebuttable presumption of
an independent contractor relationship between the parties, where
such document contains a disclosure, in type which is larger than
the other provisions in the document or in bold-faced or underlined
type, that the independent contractor is not entitled to unemployment
insurance benefits unless unemployment compensation coverage is
provided by the independent contractor or some other entity, and
that the independent contractor is obligated to pay federal and
state income tax on any moneys paid pursuant to the contract relationship.
CONNECTICUT
LAW
Conn. Gen. Stat., Chapter 567, §31-222
Sec. 31-222. Definitions. As used in this chapter,
unless the context clearly indicates otherwise:
(a) (1) "Employment", subject to the other provisions of this subsection,
means:
*****
(B) Any service . . . subject to the other provisions of this subsection,
service performed after December 31, 1977, including service in interstate
commerce, by any of the following: (i) Any officer of a corporation; (ii) any
individual who, under either common law rules applicable in determining the
employer-employee relationship or under the provisions of this subsection,
has the status of an employee. Service performed by an individual shall be
deemed to be employment subject to this chapter irrespective of whether the
common law relationship of master and servant exists, unless and until it is
shown to the satisfaction of the administrator that (I) such individual has
been and will continue to be free from control and direction in connection
with the performance of such service, both under his contract for the performance
of service and in fact; and (II) such service is performed either outside the
usual course of the business for which the service is performed or is performed
outside of all the places of business of the enterprise for which the service
is performed; and (III) such individual is customarily engaged in an independently
established trade, occupation, profession or business of the same nature as
that involved in the service performed; . . .
DELAWARE
LAW
19 Del. Code §3302(10)
(A) Any service performed prior to January 1, 1978,
which was employment as defined in this subdivision prior to such
date and, subject to the other provisions of this subdivision,
service performed after December 31, 1977, including service in
interstate commerce, by
(ii) Any individual who, under paragraph (K) of this
subdivision, has the status of an employee; . . .
(K) Notwithstanding any other provisions of this chapter
and irrespective of whether the common-law relationship of employer
and employee exists, services performed by an individual for wages,
unless and until it is shown to the satisfaction of the Department
that:
(i) Such
individual has been and will continue to be free from control and
direction in connection with the performance of such service, both
under the individual's contract for the performance of services
and in fact; and
(ii) Such
service is performed either outside the usual course of the business
for which the service is performed or is performed outside of all
the places of business of the enterprise for which the service
is performed; and
(iii) Such individual is customarily engaged in an independently
established trade, occupation, profession or business of
the same nature as that involved in the service performed.
DISTRICT OF COLUMBIA
LAW
D.C. Code § 51-101. Definitions
As used in this subchapter, unless the context indicates otherwise:
* * * *
(2) (A) "Employment" means:
(i) Any service performed prior to January
1, 1978, which was employment as defined in this subsection prior
to such date and, subject to the other provisions of this subsection,
service performed after December 31, 1971, including service in
interstate commerce, by:
* * * * *
(II) Any individual who, under the
usual common-law rules applicable in determining the employer-employee
relationship, has the status of an employee;.
FLORIDA
LAW
Fla. Stat. § 443.1216 - Employment
Employment, as defined in s. 443.036, is subject to this chapter
under the following conditions:
(1)(a) The employment subject to this chapter includes a
service performed, including a service performed in interstate
commerce, by:
* * * * *
(a)(2) An individual who, under the usual common-law
rules applicable in determining the employer-employee relationship,
is an employee.
* * * * *
(w) Service performed by an individual for remuneration
for a private, for-profit delivery or messenger service, if the
individual:
1. Is free to accept or reject jobs from the delivery or
messenger service and the delivery or messenger service does not
have control over when the individual works;
2. Is remunerated for each delivery, or the remuneration
is based on factors that relate to the work performed, including
receipt of a percentage of any rate schedule;
3. Pays all expenses, and the opportunity for profit or
loss rests solely with the individual;
4. Is responsible for operating costs, including fuel, repairs,
supplies, and motor vehicle insurance;
5. Determines the method of performing the service, including
selection of routes and order of deliveries;
6. Is responsible for the completion of a specific job and
is liable for any failure to complete that job;
7. Enters into a contract with the delivery or messenger
service which specifies that the individual is an independent contractor
and not an employee of the delivery or messenger service; and
8. Provides the vehicle used to perform the service.
GEORGIA
LAW
Ga. Code § 34-8-35
(a) As used in this chapter, the term 'employment' means any service,
including service in interstate commerce, performed for wages or
under any contract of hire, written or oral, express or implied..
. . .
(f) Services performed by an individual for wages shall be deemed
to be employment subject to this chapter unless and until it is
shown that:
(1) Such individual has been and will continue to be free from
control or direction over the performance of such services, both
under the individual's contract of service and in fact;
(2) Such service is outside the usual course of the business for
which such service is performed or such service is performed outside
of all the places of business of the enterprise for which such
service is performed; and
(3) Such individual is customarily engaged in an independently
established trade, occupation, profession, or business.
HAWAII
LAW
Hawaii Rev. Statutes
§383-2 Definition of employment. (a) As
used in this chapter, unless the context clearly requires otherwise, "employment",
subject to sections 383-3 to 383-9, means service, including service
in interstate commerce, performed for wages or under any contract
of hire, written or oral, express or implied.
§383-6 Master and servant relationship, not required
when. Services performed by an individual for wages
or under any contract of hire shall be deemed to be employment
subject to this chapter irrespective of whether the common law
relationship of master and servant exists unless and until it
is shown to the satisfaction of the department of labor and industrial
relations that:
(1) The individual has been and will
continue to be free from control or direction over the performance
of such service, both under the individual's contract of hire and
in fact; and
(2) The service is either outside the usual
course of the business for which the service is performed or that
the service is performed outside of all the places of business
of the enterprise for which the service is performed; and
(3) The individual is customarily engaged in
an independently established trade, occupation, profession, or
business of the same nature as that involved in the contract of
service.
IDAHO
LAW
Idaho Code
§72-1316. COVERED EMPLOYMENT. (1) "Covered
employment" means an individual's entire service performed by
him for wages or under any contract of hire, written or oral,
express or implied. * * * * * (4) Services
performed by an individual for remuneration shall, for the purposes
of the employment security law, be covered employment unless it is
shown; (a) That
the worker has been and will continue to be free from control or
direction in the performance of his work, both under his contract
of service and in fact; and
(b) That
the worker is engaged in an independently established trade, occupation,
profession, or business.
ILLINOIS
LAW
Illinois Compiled Statutes
820 ILCS 405/206
Sec. 206. Subject to the provisions of Sections 207 to 233,
inclusive, and of subsection B of Section 245, "employment" means
any service performed prior to July 1, 1940, which was employment
as defined in this Act prior to that date, and any service after June 30, 1940,
performed by an individual for an employing unit, including
service in interstate commerce and service on land which is owned, held or
possessed by the United States, and including all services
performed by an officer of a business corporation, without regard to whether such
services are executive, managerial, or
manual in nature, and without regard to whether such officer is
or is not a stockholder or a member of the board of directors of
the corporation.
820 ILCS 405/212
Sec. 212. Service performed
by an individual for an employing unit, whether or not such individual
employs others in connection with the performance of such services,
shall be deemed to be employment unless and until it is proven
in any proceeding where such issue is involved that-
A. Such individual has been and will
continue to be free from control or direction over the performance
of such services, both under his contract of service and in fact;
and
B. Such service is
either outside the usual course of the business for which such
service is performed or that such service is performed outside
of all the places of business of the enterprise for which such
service is performed; and
C. Such individual is engaged in an independently
established trade, occupation, profession, or business.
820 ILCS 405/212.1
Sec. 212.1. Truck Owner-Operator.
(a) The term "employment" shall
not include services performed by an individual as an operator of
a truck, truck-tractor, or tractor, provided the person or entity
to which the individual is contracted for service shows that
the individual:
(1) Is
either:
(i) Registered
or licensed as a motor carrier of real or personal property by
the Illinois Commerce Commission, the Interstate Commerce Commission,
or any successor agencies, or
(ii) Operating the equipment under an owner-operator
lease contract with the person or entity, when
the person or entity is registered, licensed, or both, as a motor
carrier of real or personal property licensed
by the Illinois Commerce Commission, the Interstate Commerce Commission, or any successor
agencies; and
(2) Has the right to terminate the lease contract and thereafter
has the right to perform the same or similar services, on whatever
basis and whenever he or she chooses, for persons or entities other
than the person or entity to which the individual is contracted
for services;
(3) Is
not required by the person or entity to which the individual is contracted for services
to perform services, or be available to perform services,
at specific times or according to a schedule
or for a number of hours specified by the person or entity, provided that pickup or delivery
times specified by a shipper or receiver shall not be deemed
specified by the person or entity;
(4) Either leases the equipment or holds title to the
equipment, provided that the individual
or entity from which the equipment is leased, or which holds any
security or other interest in the equipment, is not:
(i) The person or entity to which the
individual is contracted for service, or
(ii) Owned,
controlled, or operated by or in common with, to any extent,
whether directly or indirectly, the person or
entity to which the individual is contracted for services
or a family member of a shareholder, owner, or partner of
the person or entity;
(5) Pays
all costs of licensing and operating the equipment (except
when federal or State law or regulation requires the carrier to pay), and the
costs are not separately reimbursed by any other individual or
entity; and
(6) Maintains a separate business identity, offering or
advertising his or her services to the
public, by displaying its name and address on the equipment or
otherwise.
(b) Subsection (a) shall not apply:
(1) If, as a condition for retaining the individual's services,
the person or entity to which the individual is contracted specifies the person or entity
from which the equipment is to be leased or purchased; or
(2) To
any services that are required to be covered as a condition of
approval of this Act by the United States Secretary of Labor under
Section 3304(a)(6)(A) of the Federal Unemployment Tax Act.
(c) Nothing in this Section
shall be construed or used to effect the existence or non-existence
of an employment relationship other than for purposes of
this Act.
(d) For purposes of this Section:
(1) "Family member" means
any parent, sibling, child, sibling of a parent, or any of
the foregoing relations by marriage.
(2) "Ownership", "control",
or "operation" may be through any one or more natural persons or proxies, powers of attorney,
nominees, proprietorships, partnerships, associations, corporations,
trusts, joint stock companies, or oth |
