State of New York

Supreme Court, Appellate Division

Third Judicial Department

Decided and Entered: April 16, 2015 519579 

________________________________

In the Matter of the Claim of

JASON KLOTZ,

Respondent.

BLUE PERIMETER, INC., MEMORANDUM AND ORDER

Appellant.

COMMISSIONER OF LABOR,

Respondent.

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Calendar Date: February 24, 2015

Before: Lahtinen, J.P., Rose, Lynch and Clark, JJ.

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Benjamin F. Neidl, Albany, for appellant.

Cynthia Feathers, Glens Falls, for Jason Klotz, respondent.

Eric T. Schneiderman, Attorney General, New York City

(Linda D. Joseph of counsel), for Commissioner of Labor,

respondent.

__________

Appeal from two decisions of the Unemployment Insurance

Appeal Board, filed November 5, 2013, which ruled, among other

things, that Blue Perimeter, Inc. was liable for unemployment

insurance contributions on remuneration paid to claimant and

others similarly situated.

Claimant was hired by Blue Perimeter, Inc., a company that

purported to provide "security professionals" to its clients, and

he was assigned to work as a licensed security guard at a hotel. 

After his employment ended, claimant filed a claim for

unemployment insurance benefits. The Department of Labor issued
-2- 519579 

an initial determination finding that Blue Perimeter exercised

sufficient control over claimant's work in order to establish an

employer-employee relationship. Three subsequent hearings were

held and Blue Perimeter appeared without counsel at the first two

and provided testimony, but also requested and was granted

adjournments in order to have time to consult with counsel. When

neither Blue Perimeter nor counsel attended the third hearing,

the Administrative Law Judge (hereinafter ALJ) closed the hearing

and rendered a decision on the merits sustaining the initial

determination. Blue Perimeter thereafter applied for the matter

to be reopened for a new hearing. The Unemployment Insurance

Appeal Board treated the application as a notice of appeal and

ruled that an employment relationship existed between Blue

Perimeter and claimant, and that Blue Perimeter was liable for

unemployment insurance contributions on remuneration paid to

claimant and others similarly situated. Blue Perimeter now

appeals. 

We affirm. Initially, although a case may be reopened

"where a decision was rendered upon or following the default of a

party" (12 NYCRR 461.8), we cannot say that the Board abused its

discretion in considering the application to reopen as a request

for a new hearing, inasmuch as Blue Perimeter had not defaulted,

having appeared at two hearings and, after informing the ALJ that

it was ready to proceed, presented evidence that was considered

by the ALJ in a determination on the merits. Further, the

Board's decision not to hold a new hearing was also within its

discretion, given that Blue Perimeter had already been provided

two previous adjournments (see 12 NYCRR 463.1 [f] [2]; Matter of

Miller [Commissioner of Labor], 9 AD3d 567, 568 [2004]).

Turning to the merits, "[t]he existence of an employeremployee relationship is a factual issue for the Board to resolve

and its decision will be upheld if supported by substantial

evidence" (Matter of Ruano [Commissioner of Labor], 118 AD3d

1088, 1088 [2014], lv dismissed 24 NY3d 1039 [2014]; see Matter

of Victor [Aubrey Organics, Inc.–Commissioner of Labor], 116 AD3d

1327, 1327 [2014]). Significantly, "an organization which

screens the services of professionals, pays them at a set rate

and then offers their services to clients exercises sufficient

control to create an employment relationship" (Matter of Kimberg
-3- 519579 

[Hudacs], 188 AD2d 781, 781 [1992]; accord Matter of Ivy League

Tutoring Connection, Inc. [Commissioner of Labor], 119 AD3d 1260,

1260 [2014]; Matter of Lamar [Eden Tech., Inc.–Commissioner of

Labor], 109 AD3d 1038, 1039 [2013]; see Matter of Ray Catena

Corp. [Commissioner of Labor], 274 AD2d 819, 820 [2000]). Here,

the record reflects that Blue Perimeter ensured that claimant was

licensed in New York as a security guard, assigned him to work at

the hotel and paid him at a negotiated rate, whether or not it

received payment from the hotel. Moreover, Blue Perimeter

established claimant's schedule and there is evidence that it had

a supervisor on site at the hotel. Accordingly, there is

substantial evidence supporting the Board's decisions and they

will not be disturbed, despite evidence in the record that could

support a contrary result (see Matter of Ivy League Tutoring

Connection, Inc. [Commissioner of Labor], 119 AD3d at 1261;

Matter of Lamar [Eden Tech., Inc.–Commissioner of Labor], 109

AD3d at 1039).

Lahtinen, J.P., Rose, Lynch and Clark, JJ., concur.

ORDERED that the decisions are affirmed, without costs.

ENTER:

Robert D. Mayberger

Clerk of the Court