Case Title: Fleece on Earth v. Dept. of Employment and Training

Citation: 

Docket Number: 

State: vermont

Court: Vermont Supreme Court

Date: 2007-05-04T00:00:00Z

Document:
Fleece on Earth v. Dept. of Employment and Training (2005-367)

2007 VT 29

[Filed 04-May-2007]


       NOTICE:  This opinion is subject to motions for reargument under
  V.R.A.P. 40 as well as formal revision before publication in the Vermont
  Reports.  Readers are requested to notify the Reporter of Decisions,
  Vermont Supreme Court, 109 State Street, Montpelier, Vermont 05609-0801 of
  any errors in order that corrections may be made before this opinion goes
  to press.


                                 2007 VT 29

                                No. 2005-367


  Fleece on Earth                               Supreme Court

                                                On Appeal from
       v.                                       Employment Security Board


  Department of Employment and Training         October Term, 2006


  Patricia A. McDonald, Chair

  Erin H. Gallivan of Meub Associates, Inc., Rutland, for
    Plaintiff-Appellant.

  William H. Sorrell, Attorney General, and Bridget C. Asay, Assistant
    Attorney General, Montpelier, for Defendant-Appellee.

  John A. Facey, III of Kenlan, Schweibert & Facey, P.C., Rutland, and 
    Martin J. Newhouse and Andrew R. Grainger of New England Legal Foundation,
    Boston, Massachusetts, for Amici Curiae New England Legal Foundation and
    National Federation of Independent Business Legal Foundation.
    
  PRESENT:  Dooley, Johnson, Skoglund and Burgess, JJ., and 
            Eaton, D.J., Specially Assigned

       ¶  1.  SKOGLUND, J.   Fleece on Earth (FOE) appeals from an
  Employment Security Board decision which held that the workers who make
  clothing for FOE are employees for purposes of assessing unemployment taxes
  on FOE.  FOE contends that the Board erred in determining that the home
  knitters and sewers qualified as employees for this purpose.  We affirm the
  decision while rejecting one part of the Board's analysis.
   
       ¶  2.  FOE is a children's wear company that retails children's
  clothing.  FOE's owner designs all of the clothing sold by FOE.  FOE's
  products are made by knitters and sewers who work at home and are paid by
  the piece.  FOE provides the patterns and yarn for the knitters and
  patterns and pre-cut fabric for the sewers.  The knitters and sewers work
  on their own machines, at their own pace.  FOE sets the price per piece,
  but some workers have negotiated higher prices.  Most of the sewers and
  knitters present FOE with a bill each month, detailing the number of items
  completed and how much FOE owes for the work.  FOE retains the right to
  reject pieces that do not conform to its specifications.

       ¶  3.  The company came to the attention of the Department of Labor
  and Industry (the department) when one of FOE's knitters filed for
  unemployment benefits when she left another job.  As part of the
  application process, she listed FOE as one of her employers.  The
  department determined that FOE owed back taxes for its contract knitters
  and sewers.  FOE contested the determination, and the case went to a
  hearing before an administrative law judge (ALJ). The ALJ upheld the
  department's assessment of contributions.  FOE appealed to the Employment
  Security Board.  The Board corrected the ALJ on one conclusion but affirmed
  the determination in all other respects.  FOE appeals.
   
       ¶  4.  We review determinations by the Employment Security Board
  with a great degree of deference.  The Board's decision is "entitled to
  great weight on appeal."  Cook v. Dep't of Employment & Training, 143 Vt.
  497, 501,