Source: https://cbaclelegalconnection.com/2014/05/14/
Timestamp: 2019-04-23 04:40:15+00:00

Document:
Two recent Colorado Supreme Court cases, Industrial Claims Appeals Office v. Softrock Geological Services, Inc., 2014 CO 30, No. 12SC501 (May 12, 2014) and its companion Western Logistics, Inc. v. Industrial Claims Office, 2014 CO 31, No. 12SC911 (May 12, 2014), clarify that the determination of whether an individual is an independent contractor or employee for purposes of unemployment tax liability is based on the “totality of the circumstances” and not the rigid application of the nine-factor test set forth in C.R.S. § 8-70-115(1)(c).
Under the Colorado Employment Security Act (CESA), employers are required to pay unemployment taxes on wages paid to employees but not on payments made to independent contractors. A division of the Industrial Claims Appeal Office (ICAO) routinely audits businesses to determine whether a business is classifying its employees appropriately and collecting and submitting the correct amount of tax. Under CESA, an employer can prove that an individual is an independent contractor by demonstrating that (1) the individual is free from the employer’s control and direction, and (2) the individual is “customarily engaged in an independent trade, occupation, profession or business related to the service performed.” C.R.S. § 8-70-115(1)(b).
Combine the employer’s business operations in any way with the individual’s business, but instead maintains such operations as separate and distinct.
In Softrock, ICAO held that an individual was an employee because he provided services only to the employer during the period in question and therefore he did not have an independent trade or business. The Colorado Court of Appeals reversed, holding that ICAO incorrectly relied on a single factor. Instead, the court of appeals found that ICAO should have determined whether the individual was an employee by considering the nine factors set forth in C.R.S. § 8-70-115(1)(c).
The decision in Softrock means that the determination of whether an individual is an independent contractor or an employee for purposes of collecting unemployment compensation tax is no longer limited to the application of the nine factors set out in C.R.S. § 8-70-115(1)(c), or that the alternative single factor test factor test is dispositive. Instead, an employer can present additional information beyond the nine factors to establish the relationship. Further, the fact that an individual provides services only to one business does not conclusively establish that the individual is an employee. Rather, it is appropriate to determine the motivation of the individual and the circumstances surrounding the individual’s actions. In sum, a fact-finder will be required to look at the totality of the circumstances surrounding the relationship to determine whether a service provider is an employee or an independent contractor.
Michael Schreiner is a senior litigator at Caplan and Earnest LLC. His practice focuses on employment matters, employment-related litigation, commercial litigation and public education. He previously worked in the Colorado’s attorney general’s office, Colorado State University and the University of Colorado. He may be reached at mschreiner@celaw.com.
On Saturday, May 17, 2014, the Seventeenth Judicial District Access to Justice Committee and the Colorado Bar Association will present the 6th Annual Sean May Memorial Run at Barr Lake State Park, 13401 Piccadilly Road in Brighton. There will be three races on Saturday: a nine mile run, a 5K run, and a family fun run/walk.
The run is held each year in honor of Sean May, a deputy district attorney from the Seventeenth Judicial District who championed personal responsibility, including treating victims, the community, defendants, and the courts with dignity and respect. During his seven years of service in Adams County, May volunteered for the Child Victim Unit, where he pursued justice for children who had been physically and/or sexually abused. May died on August 27, 2008, when he was shot in his backyard when returning from work. At the time of his death, he was responsible for training and supervising new prosecutors.
Proceeds from the run will benefit Access to Justice programs and activities, as well as May’s family. Past proceeds have benefitted the Self-Help Resource Center at the Adams County Justice Center, which provides computers, information, and staff to help people with legal and procedural questions. Since its opening on January 5, 2011, the Self-Help Resource Center has aided hundreds of people, and it serves as a model of efficiency for other agencies.
Registration is available online, or participants can register on race day at Barr Lake State Park.
On Wednesday, May 14, 2014, the Tenth Circuit Court of Appeals issued no published opinion and three unpublished opinions.
The Tenth Circuit Court of Appeals issued its opinion in Rockwood Select Asset Fund XI (6)-1, LLC v. Devine, Millimet & Branch on Tuesday, May 6, 2014.
Rockwood, a Utah company, was asked to loan money and required the borrower to obtain an opinion letter from its New Hampshire law firm, Devine, Millimet & Branch. The letter was picked up by someone and forwarded to Rockwood in Utah. Rockwood determined that the letter contained falsehoods and sued Devine in Utah federal court, but the suit was dismissed for lack of personal jurisdiction. Rockwood appealed the dismissal to the Tenth Circuit.
The Tenth Circuit evaluated Rockwood’s claim of specific personal jurisdiction to determine whether Utah law would allow service on Devine and, if so, whether service would deprive Devine of due process. Because Utah law allows service on Devine under its long-arm statute, the Tenth Circuit focused its attention on whether service of process would have deprived Devine of due process. Rockwood did not meet its burden of a prima facie showing that Devine’s connections with Utah were sufficient to establish personal jurisdiction. The dismissal of the district court was affirmed.
The Tenth Circuit Court of Appeals issued its opinion in State of Utah v. Environmental Protection Agency on Tuesday, May 6, 2014.
Under the federal Clean Air Act, states are required to adopt programs that will reduce visibility-affecting air pollution emissions. The State of Utah submitted such a plan to the Environmental Protection Agency, but the agency partially rejected the state’s plan. The state and one of the affected companies, PacifiCorp, filed petitions for review. The parties all agreed that the Tenth Circuit had jurisdiction, but the Tenth Circuit disagreed.
The Clean Air Act requires an aggrieved party to file a petition to review within 60 days of the date on which the EPA’s action appears on the Federal Register. The agency’s rejection of the Utah plan appeared in the Federal Register on December 14, 2012, and Utah and PacifiCorp waited until March 21 and 22, 2013, to file petitions for review. The parties submitted four arguments to advance their cause that the petition was timely: (1) The 60-day deadline does not apply to grounds arising after the 60th day; (2) the EPA changed the promulgation date when it identified the deadline as March 23, 2013; (3) Filing after the 60th day is allowed under the “reopener doctrine”; and (4) denial of jurisdiction would be inequitable. The Tenth Circuit rejected each argument in turn.
As to the first argument, the Tenth Circuit noted that the exception does not apply because the “grounds” for the petitions lie in the EPA action published on December 14, 2012. For the second point, the EPA had neglected to include a statement regarding the parties’ 60-day deadline in its original rejection, so it stated on January 22, 2013, that aggrieved parties would have until March 25, 2013, to file a petition for review. The parties relied on this statement in error; the plain language of the EPA regulations required the EPA to explicitly change the promulgation date in the Federal Register, which it did not do. The Tenth Circuit declined to adopt the “reopener doctrine” and noted that the doctrine was inapplicable anyway. As to the fourth argument, the Tenth Circuit agreed that an inequity was created by the jurisdictional bar, but did not expand its jurisdiction to include hardships despite the inequity.
The petitions were dismissed for lack of jurisdiction.
On Tuesday, May 13, 2014, the Tenth Circuit Court of Appeals issued three published opinions and six unpublished opinions.
Leo v. Garmin International, Inc.

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