Determining if an employer-employee relationship exists for the purposes of unemployment insurance

Determining if an employer-employee relationship exists for the purposes of unemployment insurance

Ritch (Island Tutoring Ctr., Inc.--Commissioner of Labor), 2016 NY Slip Op 03569, Appellate Division, Third Department

Greene (Syracuse Socy. for New Music, Inc.--Commissioner of Labor), 2016 NY Slip Op 03567, Appellate Division, Third Department

The question of whether an employer-employee relationship exists is a factual question to be resolved by Unemployment Insurance Appeal Board and courts will not disturb its determination when it is supported by substantial evidence in the record. As the Court of Appeals held in Empire State Towing and Recovery Assn. [Commissioner of Labor], 15 NY3d 433, "An employer-employee relationship exists when the evidence shows that the employer exercises control over the results produced or the means used to achieve the results," with the latter the more important element of the test.

The IslandTutoring Center, Inc. Decision

ITC was in the business of providing general and special education tutoring services to school districts, private schools and private clients and retained private tutors to provide these services.

Kathleen Ritch and Alissa Bianco provided educational tutoring services to ITC's clients. When their employment with ITC ended, they filed applications for unemployment insurance benefits. Initially the Labor Department determined that both Ritch and Bianco [Claimants] were employees of ITC and that ITC was liable for unemployment insurance contributions based on remuneration paid to Claimants and other similarly situated tutors working for ITC. ITC objected, contending that Claimants and the other tutors were independent contractors. Following an administrative hearing, an Administrative Law Judge sustained ITC's objection and overruled the Department's determinations.

Ultimately the Unemployment Insurance Appeal Board reversed the determinations of the Administrative Law Judge and sustained the Department's initial decision that Claimants were employees and not independent contractors. ITC appealed but the Appellate Division affirmed the Board’s determination.

The court explained that it had previously held that an organization which screens the qualifications of professionals, pays them at a set rate and then offers their services to clients "exercises sufficient control to create an employment relationship."

In this instance, said the court, the record establishes that ITC advertises for tutors to provide tutoring services to its clients, interviews and screens a prospective tutor's résumé and his or her list of references. If employed, the tutor would typically sign a contract indicating that, among other things, the tutor was an independent contractor. When a client contacted ITC to request tutoring services, it would select a tutor from its database and inform that tutor of the area of study or subject to be instructed and the number of tutoring hours required. Although tutors were free to decline assignments, ITC did not permit tutors to provide their own substitutes after accepting an assignment.

Further, ITC required tutors to fill out time sheets and its session report forms in order to receive payment. As to payment, ITC paid its tutors prior to receiving payment from its clients, reimbursed tutors for certain expenses and loaned tutors teaching materials from its library when necessary. ITC also handled its clients' complaints and feedback concerning the performance of its tutors and could remove tutors from assignments if there was a negative complaint.

The Appellate Division held that this constituted substantial evidence supporting the Board's determination that an employer-employee relationship existed and that ITC was liable for contributions on remuneration paid Claimants and to all others determined to be similarly situated to Claimants.

The Syracuse Society for New Music, Inc. Decision

From 1980 to 2011, Linda M. Greene performed as a professional flautist at various new classical music concerts produced by the Syracuse Society for New Music, Inc. [SNM].

In 2012 Greene filed an application for unemployment insurance benefits. The Department of Labor determined that she was an employee — and not an independent contractor — entitled to benefits and that SNM was liable for additional contributions on remuneration paid to Greene and others similarly employed. Following a hearing, an Administrative Law Judge sustained those determinations and, upon administrative appeal, the Unemployment Insurance Appeal Board affirmed. SNM appealed.

The Appellate Division disagreed and reversed the Board’s decision. The court said the record indicated that Greene “was retained only occasionally and sporadically by SNM to perform classical music with an orchestra at various venues; … was paid at a set rate for each concert; was not required to sign a written contract; was permitted to accept or reject any assignments offered; maintained other employment while performing for SNM; and suffered no restrictions of any sort whatsoever upon her ability to perform for other organizations.

Greene testified that she had never missed a performance, but if she had hypothetically needed to be absent, it would be her ethical responsibility to attempt to obtain her own replacement. The treasurer of SNM testified that, assuming circumstances prevented Greene from attending a performance, "it would be a collaboration" to obtain a substitute, although SNM would not generally ask a musician to provide his or her own substitute.

SNM did not provide Greene with equipment nor was she not required to wear a uniform or dress in any particular manner and although the greater portion of the necessary practice for the performances was performed wholly at Greene's discretion, there were necessarily scheduled rehearsals and defined performance dates.

The requirements that Greene rehearse and perform specific pieces of music on set dates at set venues did not, in the court’s view, demonstrate meaningful control but that these requirements were, instead, inescapably inherent in the underlying function, as a concert performance necessarily demands a high level of coordination.

Explaining that a requirement that work be properly performed does not constitute an exercise of control and, in this instance, any alleged control exercised over Greene was necessary to ensure that the work for which she had been retained was carried out properly.

Accordingly, the Appellate Division, Judge Rose dissenting, held that the record lacks substantial evidence demonstrating that SNM exercised overall control over important aspects of Greene's work such as to place her within the ambit of an employer-employee relationship with SNM.

The ITC decision is posted on the Internet at:

http://www.nycourts.gov/reporter/3dseries/2016/2016_03569.htm

The SNM decision is posted on the Internet at:

http://www.nycourts.gov/reporter/3dseries/2016/2016_03567.htm

NOTE: Readers may be interested in participating in a free Internal Revenue Service Webcast Worker Classification: Employee or Independent Contractor? scheduled to be held on Thursday, May 12, 2016. For additional information and the link to register for the Webcast, go to:

http://publicpersonnellaw.blogspot.com/2016/05/worker-classification-employee-or.html

 

An Article 78 challenge to a school board's tenure determination must be initiated within four months of the determination becoming “final and binding” upon the aggrieved party

An Article 78 challenge to a school board's tenure determination must be initiated within four months of the determination becoming “final and binding” upon the aggrieved party

Garofano v Board of Educ. of Ramapo Cent. Sch. Dist., 2016 NY Slip Op 03506, Appellate Division, Second Department

The Ramapo Central School District appointed Paul D. Garofano as a foreign language teacher effective September 1, 2004. Garofano’s appointment was subject to his satisfactorily completing a three-year probationary period. However, throughout his employment with the district, Garofano’s "job title" was Instructional Technology Facilitator and he was granted tenure in the tenure area of "Instructional Technology" effective September 1, 2007.

"Instructional Technology," however, is a “nonexistent tenure area” under the Rules of the Board of Regents.*

On January 31, 2013, Garofano was informed that the Board of Education had become aware that it had appointed him to a "nonexistent tenure area" and, during a special meeting held on January 30, 2013, the Board had adopted a resolution changing his tenure area to the tenure area of School Media Specialist (Educational Communications), retroactive to September 1, 2007.

In adopting the resolution the Board noted that its basis for assigning Garofano to the School Media Specialist (Educational Communications) tenure area was because had a valid Educational Technology Specialist Initial Certificate from the New York State Education Department at the time he was granted tenure in the “nonexistent tenure area.” In addition, the Board's resolution noted that Garofano did not consent to his retroactive assignment to the School Media Specialist (Educational Communications) tenure area and contended that he should be assigned to the Elementary Education tenure area instead.

Four months later the Board voted to abolish a number of positions, including at least one position in the School Media Specialist (Educational Communications) tenure area. As Garofano was the least senior teacher of that tenure area, his employment was terminated, effective June 30, 2013.**

About September 19, 2013, Garofano filed an Article 78 petition challenging [1] the Board’s January 30, 2013, determination reassigning him to the tenure area of School Media Specialist (Educational Communications) rather than Elementary Education and [2] his subsequent termination. 

Supreme Court dismissed Garofano’s petition as time-barred, which ruling was affirmed by the Appellate Division.

The Appellate Division explained that a CPLR Article 78 review must be filed within four months of the date when the administrative determination to be reviewed became final and binding upon the aggrieved party and a determination becomes "final and binding" when two requirements are met: [1] the completeness (finality) of the determination, and [2] the exhaustion of administrative remedies. 

In the works of the court, Garofano did not commence this proceeding until September 19, 2013, nearly eight months after the Board adopted its January 30, 2013 resolution reassigning him to the tenure area of School Media Specialist (Educational Communications).

Notwithstanding Garofano argument to the contrary, the Appellate Division ruled that the Board’s action in reassigning Garofano to the tenure area of School Media Specialist (Educational Communications) did not become "effective" at a later date, nor did the [Garofano] first become aggrieved by the action upon his termination on June 30, 2013. The court said that the Board's action was complete and became effective immediately, on January 30, 2013.

Accordingly, the Supreme Court properly determined that the proceeding was barred by the statute of limitations.

* 8 NYCRR 30-1.8(b) provides for tenure areas of: (4) school media specialist; (5) school media specialist (library); and (6) school media specialist (educational communications)

** Presumably Garofano’s name was placed on the preferred list for School Media Specialist (Educational Communications) created as the result of the layoff.

The decision is posted on the Internet at:

http://www.nycourts.gov/reporter/3dseries/2016/2016_03506.htm
[Motion for leave to appeal denied]

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The Layoff, Preferred List and Reinstatement Manual - a 645 page e-book reviewing the relevant New York State laws, rules and regulations, and selected court and administrative decisions involving layoff and related matters. For more information click on http://booklocker.com/5216.html

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Worker Classification: Employee or Independent Contractor?

Worker Classification: Employee or Independent Contractor?

An Internal Revenue Service Webcast

This Webcast will be online on Thursday, May 12, 2016 at 2 p.m.(Eastern)

The link to register for this Free Webcast is at:

https://www.webcaster4.com/Webcast/Page/925/14635

This same link will be used to log on to the Webcast on May 12, 2016.

Learn about:

Why this matters

Recognize Control Factors

Benefits of Voluntary Compliance

How the Form SS-8 can help

Resources:

Government Workers: Employees or Independent Contractors?
Overview of the issue at https://www.irs.gov/Government-Entities/Federal,-State-&-Local-Governments/Government-Workers-Employees-or-Independent-Contractors

Independent Contractor - Self-Employed or Employee? 

Details regarding the issue at https://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/Independent-Contractor-Self-Employed-or-Employee

Evaluating claims of mitigating circumstances in considering challenges to the disciplinary penalty imposed by the appointing authority

Evaluating claims of mitigating circumstances in considering challenges to the disciplinary penalty imposed by the appointing authority
Gomez v Kelly, 2016 NY Slip Op 03582, Appellate Division, First Department [Gomez II]

Manuel Gomez, a New York City Police Officer, was found guilty of disciplinary charges that alleged he brandished his gun during the course of a violent off-duty domestic dispute, pointed the firearm at the civilians who were attempting to assist the victim, failed to comply with the responding police officers' instructions, and resisted being handcuffed. The penalty imposed by the New York City Commissioner of Police in Gomez II: termination of Gomez’s employment as a police officer.

Gomez appealed but the Appellate Division dismissed his petition explaining that the finding that he was guilty of the disciplinary charges in Gomez II was supported by substantial evidence, including testimony of civilian witnesses and police officers.  The court said that “[t]here exists no basis to disturb the credibility determinations of the Hearing Officer” and sustained the penalty imposed by the Commissioner, dismissal from the New York City Police Department.

In an effort to “mitigate” the penalty imposed, dismissal, Gomez argued that termination was excessive in light of his excellent service record in the department and in the military. The Appellate Divisions said that this argument was unavailing in light of his disciplinary history, citing Gomez v Kelly, 55 AD3d 305, reversed 12 NY3d 883 [Gomez I].

In Gomez I the Appellate Division said that substantial evidence supported the findings that Gomez violated [1] his commanding officer's order to terminate his involvement in a criminal investigation; [2] failed to take possession of drugs during a police department integrity test; [3] failed to voucher his helmet, mace and shield before leaving for active military duty; [4] retrieved his service handgun before the official date of his discharge from active military duty; and [5] failed to report a domestic incident to the department. The court also noted that “[t]here is no basis to disturb the hearing officer's rejection of [Gomez’s] explanations for these actions.”

The Appellate Division, however, held that the penalty imposed by the Commissioner, a one-year “dismissal probation” and a 30-day forfeiture of annual leave credits, was “excessive in light of the mitigating circumstances, i.e., [Gomez’s] several tours of active military duty, including a year in Afghanistan for which he was decorated, and the substantial pay lost in connection with his military service.”

The Commissioner appealed and the Court of Appeals reversed the Appellate Division’s ruling, explaining that it could not conclude that “the penalty . . . imposed by the Commissioner shocks the judicial conscience.”

The decision in Gomez I is posted on the Internet at:

http://www.nycourts.gov/reporter/3dseries/2008/2008_07181.htm

The decision in Gomez II is posted on the Internet at:
http://www.nycourts.gov/reporter/3dseries/2016/2016_03582.htm

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 A Reasonable Penalty Under The Circumstances - a 618-page volume focusing on New York State court and administrative decisions addressing an appropriate disciplinary penalty to be imposed on an employee in the public service found guilty of misconduct or incompetence. For more information click on http://booklocker.com/7401.html

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Selected reports issued by the Office of the State Comptroller during the week ending May 7, 2016

Selected reports issued by the Office of the State Comptroller during the week ending May 7, 2016

Click on text highlighted in color to access the entire report

State Budget increases education aid and enacts paid family leave
The recently enacted fiscal year 2016-17 state budget includes a $1.4 billion increase in school aid, as well as increases to the minimum wage and phased-in personal income tax cuts for most taxpayers, but adds to state debt and shifts significant spending off-budget and to authorities, according to a reportreleased by State Comptroller Thomas P. DiNapoli. The report also notes the budget sacrificed public transparency both in process and content.

Remaining defendants in a multi-million dollar bid-rigging of Monroe County public contracts sentenced
State Comptroller Thomas P. DiNapoli and Attorney General Eric T. Schneiderman announced the sentencing of the remaining three defendants in an elaborate bid-rigging conspiracy that illegally steered multi-million dollar public works contracts for Monroe County to favored and connected companies, resulting in the restraint of competition. The defendants profited from this scheme and defrauded the taxpayers of Monroe County. The report is posted on the Internet at:
http://osc.state.ny.us/press/releases/may16/050616a.htm?utm_source=weekly+news&utm_medium=email&utm_term=corruption&utm_content=20160508&utm_campaign=fiscal+oversight

State audits released:

City University of New York - Controls Over Bank Accounts - Lehman College

Empire State Development Corp. - Minority and Women-Owned Business Enterprises Program; and

Ogdensburg Bridge and Port Authority - Capital Planning and Maintenance

State law governing voter registration does not require a “wet signature” and asignature can be affixed electronically if the application form is completed “on-line”

State law governing voter registration does not require a “wet signature” and asignature can be affixed electronically if the application form is completed “on-line”

Informal Opinions of the Attorney General, Informal Opinion 2016-1

Dennis M. Brown, Suffolk County’s County Attorney, explaining that Suffolk County was considering a voter registration system that would allow an individual to register to vote by completing an application online, wrote to the Attorney General to inquire if state law governing voter registration requires that the signature of a registrant be hand written, i.e., written with ink, or a “wet signature.”

Kathryn Sheingold, Assistant Solicitor General in Charge of Opinions, responding to Mr. Brown, opined that “state law governing voter registration does not require a wet signature,” indicating that a signature can be affixed electronically as the “election law does not specifically require a signature written with ink on a voter registration application.” However, cautioned Ms. Sheingold, “the technology … must capture a handwritten signature that can be incorporated into the registration records and compared with the signature that the applicant will write at the polling location at the time of voting.”*

Another element to consider relating to a registration application completed online is that the application, once so completed, would have to either (a) be printed and mailed to the local board of elections by the applicant or a third party assisting the applicant or (b) be completed by appearing at the local board of elections. Otherwise, said Ms. Sheingold, “the County would be creating a new system of registration rather than using the existing system outlined by the Legislature.”

Ms. Sheingold’s response to the Suffolk County Attorney is posted on the Internet at:

http://www.ag.ny.gov/sites/default/files/opinion/2016-1_pw_0.pdf

Although the Attorney General issues Formal Opinions only to officers and departments of State government, Informal Opinions are prepared  by the Attorney General’s Office of the Solicitor General in Charge of Opinions in response to inquiries from officers of a political subdivision of the State.

* Presumably the signature written on the envelope enclosing an absentee ballot submitted by the voter would be compared with electronic signature incorporated into the voter registration records.