Opinion ID: 2679984
Heading Depth: 3
Heading Rank: 2

Heading: Part B: Place of Employment

Text: [¶35] Sinclair stipulates that the workers’ services were within Sinclair’s usual course of business but disputes that they were performed within Sinclair’s places of business. Sinclair argues that the construction jobsites were not “places of business” pursuant to part B of the test. [¶36] Although we have held that a woodlot constitutes a place of business for a timber harvester, where the employer has a “significant and business-related presence,” see McPherson Timberlands, Inc., 1998 ME 177, ¶¶ 17-18, 714 A.2d 818, we have declined to call customers’ homes a place of business for salespeople, despite the fact that they made sales there, see Hasco Mfg. Co., 158 Me. at 418, 185 A.2d 442. 22 [¶37] Several other states have declined to call a construction jobsite a “place of business” within the meaning of part B of the ABC test because it “precludes any construction company from ever meeting the requirements of [the ABC test] with regard to tradespeople hired for construction work.” See Metro Renovation, Inc. v. State Dep’t of Labor, 543 N.W.2d 715, 722 (Neb. 1996), disapproved on other grounds by State v. Nelson, 739 N.W.2d 199, 204 (Neb. 2007). See also Matter of BKU Enters., Inc., 513 N.W.2d 382, 385 (N.D. 1994) (“The fact that the contract must be performed at a specific location, such as a building site, does not, by itself, constitute furnishing a place to work if the nature of the work to be done precludes a separate site or is the customary practice in the industry.” (quotation marks omitted)); Barney v. Dep’t of Emp’t Sec., 681 P.2d 1273, 1275 (Utah 1984). [¶38] The Commission’s determination that a construction jobsite is a place of business within the meaning of 26 M.R.S. § 1043(11)(E)(2) could require a general contractor to be responsible for unemployment insurance taxes for a delivery person who provides the materials from a lumber company, for example. If this were the test, an employer’s “satisf[action of] the B standard’s second alternative would be practically impossible.” See Carpet Remnant Warehouse, Inc., 593 A.2d at 1190; see also Christopher J. Cotnoir, Comment, Employees or Independent Contractors: A Call for Revision of Maine’s Unemployment 23 Compensation “ABC Test,” 46 Me. L. Rev. 325, 338-39 (1994) (discussing the economic effects of the restrictive ABC test on the construction industry). [¶39] Such an illogical reading of part B is not consistent with the intent of the Legislature. See Carrier, 2012 ME 142, ¶ 12, 60 A.3d 1241 (stating that we interpret statutes to avoid illogical results). [W]e cannot permit the letter of the law to transcend the spirit of the law. . . . [W]hether a person performing services is an employee or an independent contractor is the question before us, and statutes [applicable to] . . . such determinations must not be distorted to allow persons who are truly independent in their operation to be held employees merely for tax purposes and resulting benefits derived from an employer-employee relationship. Johnson v. Mont. Dep’t of Labor & Indus., 783 P.2d 1355, 1357-58 (Mont. 1989) (quotation marks omitted). Thus, we do not defer to the Commission’s determination with respect to part B and conclude that Sinclair has met its burden. See 26 M.R.S. § 1043(11)(E)(2). [¶40] Because the Commission erred in determining that Sinclair failed to meet its burden with respect to parts A and B of the ABC test with respect to eighteen of the disputed workers, we vacate the Commission’s judgment with regard to those individuals. Having concluded that Sinclair met its burden of demonstrating that those eighteen workers met all three criteria of the ABC test, we remand the case for a redetermination of the appropriate taxes and penalties consistent with this opinion. 24 The entry is: Judgment vacated as to the eighteen individuals identified in footnote 4 of this opinion, and affirmed in all other respects. Remanded to the Superior Court for remand to the Unemployment Insurance Commission for further proceedings consistent with this opinion. On the briefs: Frank T. McGuire, Esq., and John K. Hamer, Esq., Rudman Winchell, Bangor, for appellant Sinclair Builders, Inc. Janet T. Mills, Attorney General, and Elizabeth J. Wyman, Assist. Atty. Gen., Office of Attorney General, Augusta, for appellee Maine Unemployment Insurance Commission At oral argument: John K. Hamer, Esq., for appellant Sinclair Builders, Inc. Elizabeth J. Wyman, Asst. Atty. Gen., for appellee Maine Unemployment Insurance Commission Hancock County Superior Court docket number AP-2011-10 FOR CLERK REFERENCE ONLY