Court Opinion

ID: 9939703
Source: CourtListenerOpinion
Date Created: 2024-02-12 15:11:34.078542+00
Date Added: 2024-06-11T13:41:49.948287
License: Public Domain

NOT FOR PUBLICATION WITHOUT THE
              APPROVAL OF THE APPELLATE DIVISION

                                 SUPERIOR COURT OF NEW JERSEY
                                 APPELLATE DIVISION
                                 DOCKET NO. A-1500-21
                                            A-1710-21

STATE SHORTHAND
REPORTING SERVICES,

     Petitioner-Appellant,

v.

NEW JERSEY DEPARTMENT
OF LABOR AND WORKFORCE
DEVELOPMENT,

     Respondent-Respondent.
_______________________________

JERSEY SHORE REPORTING,
LLC,

     Petitioner-Appellant,

v.

NEW JERSEY DEPARTMENT
OF LABOR AND WORKFORCE
DEVELOPMENT,

     Respondent-Respondent.
_______________________________

           Submitted (A-1500-21) and Argued (A-1710-21)
           January 16, 2024 — Decided February 12, 2024

           Before Judges Mawla, Marczyk, and Chase.
           On appeal from the New Jersey Department of Labor
           and Workforce Development, Docket Nos. 14-001 and
           14-003.

           Martin Melody, LLC, attorneys for appellant State
           Shorthand Reporting Services, Inc. in A-1500-21
           (Eugene J. Melody, of counsel; Nancy S. Martin, on the
           briefs).

           James Prusinowski argued the cause for appellant
           Jersey Shore Reporting, LLC in A-1710-21 (Trimboli
           & Prusinowski, LLC, attorneys; James Prusinowski and
           Brittany Rose Naimoli, on the briefs).

           Ryne Anthony Spengler, Deputy Attorney General,
           argued the cause for respondent Department of Labor
           and Workforce Development (Matthew J. Platkin,
           Attorney General, attorney; Donna Sue Arons,
           Assistant Attorney General, of counsel; Kendall James
           Collins, Deputy Attorney General, on the briefs).

           Einhorn, Barbarito, Frost & Botwinick, PC, attorneys
           for amicus curiae Certified Court Reporters
           Association of New Jersey in A-1710-21 (Andrew Seth
           Berns, of counsel and on the brief; Matheu D. Nunn, on
           the brief).

     The opinion of the court was delivered by

MARCZYK, J.A.D.

     In this appeal, as an issue of first impression, we are asked to consider

whether N.J.S.A. 43:21-19(i)(10)—from the time of its enactment in 2010—

provides an exemption for court reporters under the Unemployment

Compensation Law ("UCL"), N.J.S.A. 43:21-1 to -71, or whether court reporters

                                                                       A-1500-21
                                     2
must still establish a Federal Unemployment Tax Act ("FUTA") exemption

pursuant N.J.S.A. 43:21-19(i)(1)(G). For the reasons set forth below, we have

determined N.J.S.A. 43:21-19(i)(10) does provide such an exemption and there

is no requirement for court reporters to establish a FUTA exemption.

      We consolidate these two appeals for the purpose of issuing a single

opinion.   Petitioner Jersey Shore Reporting, LLC ("JSR") appeals from a

December 31, 2021 final administrative action of the Commissioner of the

Department of Labor and Workforce Development ("DOL") finding JSR liable

for contributions under the UCL. Petitioner State Shorthand Reporting Services

("SSRS") also appeals from the Commissioner's December 31, 2021 final

administrative action finding SSRS responsible for contributions under the

UCL. Although we conclude SSRS and JSR are entitled to an exemption under

N.J.S.A. 43:21-19(i)(10), the DOL audited SSRS and JSR for time periods both

before and after that statute's January 16, 2010 effective date. We conclude the

exemption applies to the audit dates after January 16, 2010.

      Regarding the audit periods prior to January 16, 2010, we address in the

unpublished portion of this opinion whether JSR and SSRS satisfied N.J.S.A.

43:21-19(i)(6)(A) to (C) ("the ABC test") for the purpose of establishing that

the reporters were independent contractors during that time period.          We

determine the Commissioner did not act in an arbitrary or capricious manner in

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                                       3
finding petitioners failed to satisfy the ABC test. Accordingly, we reverse in

part, affirm in part, and remand for the Commissioner to recalculate the

assessments owed by petitioners consistent with this opinion.

                                        I.

                                        A.

      We derive the following from the record as it pertains to JSR. JSR is a

registered court reporting agency that provides legal transcription services to

attorneys, courts, and public agencies. The owners of JSR are not court reporters

and therefore only handle administrative matters and brokering the services of

court reporters. JSR fills numerous court reporting jobs each day and solicits

reporters with a mass email based on reporters' preference concerning the

location of the job and days and hours they are available. Generally, the first

reporter to respond gets the assignment. Reporters are not forced to take an

assignment and do not suffer any consequences for not agreeing to take a job.

If JSR cannot fill a slot, it reaches out to other agencies. Reporters are provided

the time and location of an assignment, but no specific instructions.

      Once an event is completed, the reporter will inform JSR as to how many

transcripts have been requested, and JSR prints, delivers, and bills for the

services. Reporters can be compensated for an appearance, or an hourly rate

when no transcript is ordered, or on a per-page rate. Reporters who work with

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                                        4
JSR also work with other agencies.          The reporters provide their own

stenographic machines. JSR does not: have policies or procedures for reporters;

require reporters to work a certain number of hours; provide supplies; proofread

reporters' work; or pay for supplies or continuing education.

      In August 2013, following an audit, the DOL assessed JSR for $39,236.06

in unpaid contributions to the DOL's unemployment and disability benefit funds

as a result of an audit from 2008-2010.1 In January 2015, JSR moved for

summary decision, asserting it was not liable for the contributions.        The

administrative law judge ("ALJ") determined there were genuine issues of

material fact regarding whether the ABC test was met that necessitated a hearing

regarding JSR's liability for 2008 and 2009. The ALJ granted JSR's motion for

summary decision for the 2010 time period, finding N.J.S.A. 43:21-19(i)(10)

"amended the UCL . . . to specifically exempt services performed by legal

transcribers or court reporters irrespective of a parallel exemption under" the

FUTA.

      On April 23, 2018, the DOL requested the Commissioner review the ALJ's

initial decision. On July 19, 2018, the Commissioner issued a decision and

1
   The parties unsuccessfully attempted to mediate. In May 2014, JSR moved
for leave to appeal because the Office of Administrative Law ("OAL") failed to
transfer the contested case for a hearing. In May 2014, we ordered the case
transferred to the OAL for a hearing as a contested case.

                                                                         A-1500-21
                                       5
accepted the ALJ's denial of summary decision for the audit years of 2008 and

2009 but rejected the ALJ's summary decision for the audit year of 2010 based

on N.J.S.A. 43:21-19(i)(10). The Commissioner instead relied on N.J.S.A.

43:21-19(i)(1)(G), which states:

            Notwithstanding any other provision of this subsection,
            service in this State with respect to which the taxes
            required to be paid under any federal law imposing a
            tax against which credit may be taken for contributions
            required to be paid into a state unemployment fund or
            which as a condition for full tax credit against the tax
            imposed by the [FUTA] is required to be covered under
            the [UCL] . . . .

According to the Commissioner, N.J.S.A. 43:21-19(i)(1)(G) provides the mere

existence of a state exemption under N.J.S.A. 43:21-19(i)(10) is not enough, and

there must also be a parallel FUTA exemption to be relieved of the obligation

to pay unemployment taxes.

                                      B.

      SSRS is also a court reporting agency that provides transcription services

to various entities. It notes court reporters are "strictly regulated" and are

licensed through the Department of Consumer Affairs. They must pass a test

administered through a national court reporting association to become licensed

in New Jersey. The owner and operator of SSRS testified:

            She maintains a list of certified court reporters and
            assigns jobs to cover a court reporting project on an as
            needed basis. Most of the court reporters may work for

                                                                         A-1500-21
                                       6
             several different court reporting agencies at any given
             time and do not work exclusively for [SSRS]. In
             addition, they may accept or reject any assignment that
             [SSRS] offers them. Once a reporter accepts a job, they
             are given the date, time[,] and location of the job. The
             reporters are responsible for their own equipment,
             travel[,] and other job-related expenses. Once a
             reporter transcribes a proceeding, he or she emails it to
             [SSRS] for delivery to the client. [SSRS] handles all
             the billing.

      SSRS maintains it does not control or provide instructions for court

reporters.   It asserts the reporters operate independently, are free to work

whenever they want, and set their own work schedule.

      In August 2013, the DOL assessed SSRS for unpaid contributions to

unemployment and disability funds for the periods of 2006-2008 and 2011-2014.

Based on an audit of those time periods, SSRS had unpaid contributions of

$104,116.45—$38,340.44 for 2006-2008 and $65,776.01 for 2011-2014. SSRS

appealed, and the matter was transferred to the OAL for a hearing before an ALJ

as a contested case.        The ALJ ultimately determined, based on the

Commissioner's prior decision in the JSR matter, the exemption under N.J.S.A.

43:21-19(i)(10) requires a parallel FUTA exemption.

                                        II.

                                        A.

      JSR and SSRS argue they meet the exemption under N.J.S.A. 43:21-

19(i)(10) and therefore are not liable. They argue the statutory language is clear

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                                        7
and unambiguous and that services provided by certified court reporters should

not be considered employment subject to the UCL. Moreover, the legislative

history of N.J.S.A. 43:21-19(i)(10) supports this interpretation.

      JSR contends the Commissioner erred in finding N.J.S.A. 43:21-

19(i)(1)(G) applies to N.J.S.A. 43:21-19(i)(10), thus requiring court reporters to

establish a FUTA exemption. It argues the statute's context and relationship to

surrounding provisions shows N.J.S.A. 43:21-19(i)(1)(G) does not apply to

every provision in N.J.S.A. 43:21-19(i).       According to JSR, the statute's

hierarchy shows N.J.S.A. 43:21-19(i)(1)(G), a sub-sub-section, is contained in

and applies only to the provisions in subsection N.J.S.A. 43:21-19(i)(1). That

is, the provision states it applies "[n]otwithstanding any other provision of this

subsection," but JSR contends that it is meant to apply to the actual subsection

of N.J.S.A. 43:21-19(i)(1), not the entire section of N.J.S.A. 43:21-19(i).

      JSR argues the Legislature intended to amend the statute to remove the

FUTA exemption from N.J.S.A. 43:21-19(i)(10) requirements.            If N.J.S.A.

43:21-19(i)(1)(G) imposed the FUTA exemption on all of N.J.S.A. 43:21-19(i),

JSR argues there would have been no modification to the statute. A FUTA

exemption was required prior to the 2010 amendment, so it follows the

Legislature amended the statute to exempt court reporters. Requiring reporters

to prove a FUTA exemption would render the 2010 amendment meaningless.

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                                        8
      JSR argues if the Legislature wanted to require a FUTA exemption on all

categories under the statute, it would have clearly articulated the requirement.

For example, N.J.S.A. 43:21-19(i)(7), which provides for twenty-seven

exemptions, qualifies the exemptions, noting they are available "[p]rovided that

such services are also exempt under the [FUTA] . . . ." JSR notes that if N.J.S.A.

43:21-19(i)(1)(G) applied to the entire statute, N.J.S.A. 43:21-19(i)(7) would be

redundant as it refers to the same tax credits and FUTA. As such, JSR and SSRS

assert the language of N.J.S.A. 43:21-19(i)(10) is clear and unambiguous, and

court reporting services are statutorily exempt from unemployment taxes.

      Amicus curiae Certified Court Reporters Association of New Jersey

("CCRA") also contends N.J.S.A. 43:21-19(i)(10) is clear on its face, and the

legislative history explains that court reporters are now considered independent

contractors. Moreover, there is no basis to continue to require a correspo nding

FUTA exemption under N.J.S.A. 43:21-19(i)(1)(G) given the enactment of

N.J.S.A. 43:21-19(i)(10).     Furthermore, the Commissioner's interpretation

would render the amendment superfluous, and if the Legislature intended for the

FUTA exemption to still apply, there would have been no need to amend the

statute.

                                       B.

                                                                           A-1500-21
                                        9
      Although we review administrative decisions with a deferential standard

of review, "a reviewing court is 'in no way bound by [an] agency's interpretation

of a statute or its determination of a strictly legal issue.'" Allstars Auto Grp.,

Inc. v. N.J. Motor Vehicle Comm'n, 234 N.J. 150, 158 (2018) (alteration in

original) (quoting Dep't of Children & Fams. v. T.B., 207 N.J. 294, 302 (2011)).

"[If] an agency's determination . . . is a legal determination, the appellate court's

review is de novo." K.K. v. Div. of Med. Assistance and Health Servs., 453 N.J.

Super. 157, 161 (App. Div. 2018) (alteration in original) (quoting L.A. v. Bd. of

Educ. of Trenton, Mercer Cnty., 221 N.J. 192, 204 (2015)).

      "The overriding goal" of statutory interpretation "is to determine . . . the

intent of the Legislature, and to give effect to that intent." State v. Hudson, 209

N.J. 513, 529 (2012). We begin with the understanding "the language of the

statute, and the words chosen by the Legislature should be accorded their

ordinary and accustomed meaning." Ibid. "Where the plain language of a statute

is clear, we enforce the statute as written." Correa v. Grossi, 458 N.J. Super.

571, 579 (App. Div. 2019) (citing DiProspero v. Penn, 183 N.J. 477, 492

(2005)).

      Moreover, "[i]f the language leads to a clearly understood result, the

judicial inquiry ends without any need to resort to extrinsic sources." Hudson,

209 N.J. at 529. "[E]xtrinsic aids may not be used to create ambiguity when the

                                                                              A-1500-21
                                         10
plain language of the statute itself answers the interpretative question; however,

when the statutory language results in more than one reasonable interpretation,

then resort may be had to other construction tools . . . in the analysis ." Id. at

529-30 (citing State v. Shelley, 205 N.J. 320, 323-24 (2011)). These may

"includ[e] legislative history, committee reports, and contemporaneous

construction." DiProspero, 183 N.J. at 492-93 (quoting Cherry Hill Manor

Assocs. v. Faugno, 182 N.J. 64, 75 (2004)).

      N.J.S.A. 43:21-19(i)(10) in pertinent part provides:

            Services performed by a legal transcriber, or certified
            court reporter certified pursuant to P.L.1940, c.175
            [(N.J.S.A. 45:15B-1 to -14)], shall not be deemed to be
            employment subject to the [UCL], [N.J.S.A. 43:21-1 to
            -71], if those services are provided to a third party by
            the transcriber or reporter who is referred to the third
            party pursuant to an agreement with another legal
            transcriber or legal transcription service, or certified
            court reporter or court reporting service, on a freelance
            basis, compensation for which is based upon a fee per
            transcript page, flat attendance fee, or other flat
            minimum fee, or combination thereof, set forth in the
            agreement.

            [(Emphasis added).]

      The express language of N.J.S.A. 43:21-19(i)(10) provides that services

performed by court reporters "shall not be deemed to be employment subject to"

the UCL. This provision is not qualified by reference to any FUTA exemption.

Prior to 2010, under N.J.S.A. 43:21-19(i)(7)(Y), court reporters were also

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                                       11
exempt, provided they were "also exempt under . . . FUTA . . . ." N.J.S.A. 43:21-

19(i)(7)(Y) (2002). We presume the Legislature understood the implications of

removing court reporters from N.J.S.A. 43:21-19(i)(7)(Y) and the corresponding

FUTA mandate and placing the amendment in a different section, specifically

indicating that court reporting services are not to be considered employment

under the UCL. This amendment was designed so that court reporters would no

longer be required to establish a FUTA exemption pursuant to N.J.S.A. 43:21 -

19(i)(7) and were, by the specific terms of the amendment, not to be considered

employees, but rather independent contractors.              The     Commissioner's

interpretation is at odds with the plain language of the statute.

      The DOL asserted before the Commissioner that the Legislature may have

been "well intentioned" in adopting N.J.S.A. 43:21-19(i)(10) and attempting to

grant an exemption to court reporters, but the Legislature was unsuccessful

because N.J.S.A. 43:21-19(i)(1)(G) still requires that petitioners establish a

FUTA exemption. At oral argument, the DOL claimed the amendment set forth

in N.J.S.A. 43:21-19(i)(10) was effectively meaningless.

      It is a "well-established canon of statutory interpretation" that the

Legislature is presumed to know the "judicial construction of its enactments."

Johnson v. Scaccetti, 192 N.J. 256, 276 (2007) (quoting DiProspero, 183 N.J. at

494), abrogated on other grounds, Cuevas v. Wentworth Grp., 226 N.J. 480, 506

                                                                            A-1500-21
                                        12
(2016). Moreover, "[t]he Legislature is presumed to be familiar with its existing

enactments and is presumed to intend that its newer enactments be harmonized

with the existing ones, in light of the Legislature's purpose." Correa, 458 N.J.

Super. at 580. In attempting to harmonize more recent amendments in the

context of existing statutory provisions, as always "[w]e will 'strive for an

interpretation that gives effect to all of the statutory provisions and does not

render any language inoperative, superfluous, void[,] or insignificant.'" Sanchez

v. Fitness Factory Edgewater, LLC, 242 N.J. 252, 261 (2020) (second alteration

in original) (quoting G.S. v. Dep't of Hum. Servs., 157 N.J. 161, 172 (1999)).

      The Commissioner's interpretation of N.J.S.A. 43:21-19(i)(10) indicates

the Legislature failed to recognize the requirement under N.J.S.A. 43:21-

19(i)(1)(G) for an employer to still establish a FUTA exemption. The DOL

asserted there are no scenarios in which the new statute, N.J.S.A. 43:21-

19(i)(10), would apply to court reporters that was distinct from the operation of

the prior exemption under N.J.S.A. 43:21-19(i)(7)(Y).        We reject such an

interpretation, which would render N.J.S.A. 43:21-19(i)(10) meaningless.

N.J.S.A. 43:21-19(i)(10) must be read in harmony with N.J.S.A. 43:21-

19(i)(7)(Y). The Legislature was fully aware of the prior requirement for court

reporters to establish a FUTA exemption under N.J.S.A. 43:21-19(i)(7)(Y),

which is why it amended the statute to remove the requirement for a FUTA

                                                                          A-1500-21
                                       13
exemption under N.J.S.A. 43:21-19(i)(10). The Legislature placed N.J.S.A.

43:21-19(i)(10) in a separate section, presumably to remove it from N.J.S.A.

43:21-19(i)(7), which requires a corresponding FUTA exemption. Moreover,

we agree with JSR that the requirement to establish a FUTA exemption under

N.J.S.A. 43:21-19(i)(1)(G) only applies to that specific subsection.

      Although we agree a sensible reading of N.J.S.A. 43:21-19(i)(10)

provides an exemption for court reporters, to the extent the statutory language

results in more than one reasonable interpretation, the legislative history

unequivocally establishes the Legislature intended to dispense with the

requirement to establish a FUTA exemption. The Senate Labor Committee

statement provided:

            [T]he bill makes an individual who is a legal transcriber
            and who works on a freelance basis, compensation for
            which is based upon a fee per transcript page, flat
            attendance fee, or other flat minimum fee, or
            combination thereof, ineligible for unemployment
            insurance (UI) benefits and thus not subject to UI taxes.
            The bill provides the exemption to all such individuals
            categorically without requiring a demonstration that
            particular individuals are self-employed under the
            standards provided by either the State UI statute or
            federal tax rules.

                  ....

            The amendments also remove the requirement that the
            exemption applies only if there is a parallel exemption
            under federal UI law or if the individuals are found to
            be self-employed by the IRS under its tax rules.

                                                                        A-1500-21
                                       14
             [S. Labor Comm. Statement to S. 825 (May 4, 2009)
             (emphasis added).] 2

The legislative history is unambiguous regarding the elimination of the

requirement for a FUTA exemption and bolsters our interpretation of the statute.

Accordingly, we reverse the Commissioner's holding with respect to the

applicability of N.J.S.A. 43:21-19(i)(10) and conclude petitioners are exempt

from the time of the enactment of the statute in 2010. We remand for the

Commissioner to calculate the assessment regarding those audit periods after the

enactment of N.J.S.A. 43:21-19(i)(10).

                                      III.

        We next address the Commissioner's separate determination that

petitioners failed to establish they were independent contractors under the ABC

test.

                                      A.

        In July 2020, the Commissioner remanded JSR's case to the ALJ for an

evidentiary hearing regarding the 2008-2010 audit period. In September 2020,

following a hearing, and after evaluating the ABC test, the ALJ found JSR had

no liability for the entire audit period as the court reporters were independent

2
   The Assembly Labor Committee statement closely mirrors the Senate's
legislative history. See A. Labor Comm. Statement to A. 3770 (Jan. 4, 2010).

                                                                         A-1500-21
                                      15
contractors. As to prong A, the ALJ determined the reporters were generally

free from JSR's control because they were not trained by JSR, were free to

choose when to work, and could work for competitors. As to prong B, the ALJ

found the court reporters did not work out of JSR's offices, but rather from client

locations.3 Under prong C, the ALJ found the reporters were free to provide

services to other agencies while continuing to accept work from JSR. He further

found the reporters could likely continue to work with different agencies if a

particular agency failed or went out of business. Thus, according to the ALJ

and citing Hargrove v. Sleepy's LLC, 220 N.J. 289, 306 (2015), they had a

profession "that will plainly persist despite the termination of the challenged

relationship," and JSR met prong C.

      On December 31, 2021, the Commissioner rejected the ALJ's decision.

Concerning prong A, although the Commissioner noted the reporters had "some

flexibility" in their work, he found critical aspects of the reporters' work were

controlled by JSR. The Commissioner noted the key components of the work—

finding and maintaining relationships with clients, setting the rate charged to

clients and reporters, determining when work must be completed, and recovering

from clients who fail to pay—"are all set by [JSR]."          The "major formal

3
   The ALJ noted there were rare circumstances in which work was performed
at the office, such as when a client did not have an available conference room.

                                                                            A-1500-21
                                        16
elements" of employment were all controlled by the agency. As such, the

Commissioner determined JSR failed to meet prong A.

      Under prong B, the Commissioner found the ALJ ignored the fact JSR is

in the business of providing court reporting services to the legal community, and

therefore JSR's place of business is in some part located at client locations within

the legal community. He found:

            Much of the actual work, therefore, takes place in these
            locations . . . . These services are an integral part of
            [JSR]'s business, and delivery of services in these
            locations is not a random occurrence. Rather, it is
            specifically determined at the time of acceptance of the
            contract with [JSR]. These client locations, therefore,
            must under Carpet Remnant[ Warehouse, Inc. v. N.J.
            Department of Labor, 125 N.J. 567 (1991),] be
            considered an extension of [JSR]'s place of business.

      Under prong C, the Commissioner found the ALJ "largely ignored the

results of the [DOL]'s thorough audit." He explained:

                    In conducting an audit for potential
            misclassification, it is standard [DOL] practice to
            contact the purported employer and all purported
            subcontractors and request that they submit
            documentation (such as tax returns, business cards,
            invoices, letterhead, advertisements they have taken
            out, insurance, and other 1099s) that would help the
            [DOL] to determine their employment status. . . . Since
            there was no real dispute over whether remuneration
            had been paid to the court reporters for their services,
            that established a presumption of employee status
            unless [JSR] could meet each prong of the ABC test. In
            practice, as testified to by [the] redetermination auditor
            . . . , this meant that if a purported employer did not

                                                                             A-1500-21
                                        17
             provide the [DOL] with relevant documents, the [DOL]
             could lawfully infer that the individual was likely an
             employee, as no information was provided to rebut the
             presumption of employee status. . . .

       The Commissioner further noted:

                   The audit record shows that [JSR] provided
             documentation for slightly less than half of the court
             reporters that it engaged. [4] . . . The company did not
             submit any documents, and no other evidence, to rebut
             the lawful presumption that its remaining court
             reporters (totaling 52.3%) were not customarily
             engaged in an independently established business.

The Commissioner further analyzed Schedule C tax forms for several court

reporters received by the DOL and found "only a small number showed true

independence." He noted multiple reporters clearly earned the entirety of their

annual income from JSR in the 2008-2010 span. Two of them also had JSR

business cards with their names on it. Multiple other reporters earned more than

ninety percent of their annual income from JSR during the audit period. The

4
    The Commissioner noted:

             In 2008, out of [thirty-two] court reporters engaged by
             [JSR], the [DOL] only received documents for
             [fifteen]. . . . In 2009, out of [thirty] court reporters
             engaged by [JSR], the [DOL] only received documents
             for [fifteen]. . . . And in 2010, out of [thirty-one] court
             reporters engaged by [JSR], the [DOL] only received
             documents for [fourteen]. . . . Adding it together, out
             of [ninety-three] court reporters engaged by [JSR]
             during the audit period, the [DOL] received
             documentation for only [forty-four] (totaling 47.3%).

                                                                           A-1500-21
                                         18
Commissioner noted these "purported[] independent contractors were in reality

wholly dependent upon [JSR]."

      The ALJ noted that if one agency went out of business, the reporters would

be able to secure work from another agency. The Commissioner, quoting Carpet

Remnant, found this was insufficient to overcome the presumption of employee

status because it did not demonstrate the reporters could "continue to exist

independently and apart from" their relationship with JSR as an independent

business. 125 N.J. at 592. Therefore, the Commissioner concluded JSR failed

to meet prong C.

      Regarding the proceedings against SSRS, the matter was assigned to an

ALJ, who ordered the matter be placed on the inactive list pending the

processing of an Internal Revenue Service ("IRS") Form SS-8.5 On July 14,

2016, the IRS issued an "information letter" to SSRS, which stated "based solely

on the information you provided . . . we conclude that an employer/employee

relationship does not exist in the situation you described." However, the letter

also stated it "isn't a determination letter and isn't binding."

5
  IRS Form SS-8 asks the IRS to determine whether under federal law a worker
is considered an employee or independent contractor for purposes of federal
employment and income taxes. The parties theorized its outcome would affect
the pending case.

                                                                         A-1500-21
                                         19
      The matter was subsequently assigned to a different ALJ. In June 2017,

SSRS filed a motion for summary decision. The ALJ found there were genuine

issues of material fact that necessitated a hearing to determine SSRS's liability

for the 2008-2009 audit period. She thus denied SSRS's motion for summary

decision regarding the 2008-2009 period.        Regarding liability from 2011

onward, the ALJ stated the Legislature "amended the UCL in 2010 to

specifically exempt services performed by legal transcribers . . . ." However,

the ALJ found it was an "open question" whether a corresponding FUTA

exemption was required to assert the specialized exemption under N.J.S.A.

43:21-19(i)(7), (i)(9), and (i)(10). Therefore, summary decision on liability for

the 2011-2014 period was also denied because there was a genuine issue of

material fact "as to the effect and extent of the amendments to the UCL, and the

need for a corresponding FUTA exemption."

      In October 2019, the ALJ found SSRS had no liability for either audit

period. She cited the Commissioner's prior decision involving JSR, stating in a

footnote the DOL "has ruled that the intention of [the 2010 legislative

amendment to the UCL] was to provide for an exemption, only when someone

has received a corresponding FUTA exemption." In the footnote, the ALJ also

stated "[n]o corresponding FUTA exemption was demonstrated in this case."

However, she did not clearly determine whether SSRS established a FUTA

                                                                          A-1500-21
                                       20
exemption.      She went on to analyze whether the court reporters were

independent contractors under N.J.S.A. 43:21-19(i)(6)(A), (B), and (C), thereby

exempting them from UCL coverage. The ALJ ultimately determined SSRS

satisfied prongs A, B, and C for many of the same reasons as the ALJ in the JSR

case above.

      On December 31, 2021, the Commissioner reversed the ALJ's initial

decision and held a putative employer must establish both a UCL exemption and

a FUTA exemption in order to assert the specialized exemption, and SSRS did

not establish a FUTA exemption. The Commissioner noted N.J.A.C. 12:16-

23.26 permits three methods for a putative employer to establish a FUTA

exemption:

              (a) Evidence that services are not covered under FUTA
              may include among other things:

                   1.    Private letter ruling(s) from the [IRS];

                   2.    An employment tax audit conducted by the
                   [IRS] after 1987 which determined that there was
                   to be no assessment of employment taxes for the
                   services in question; however, the determination
                   must not have been the result of the application
                   of Section 530 of the Revenue Act of 1978; or

                   3.    Determination letter(s) from the [IRS].

6
  Prior to 2018, a putative employer could provide documentation of responses
to the twenty-point test required by the IRS to meet the criteria for
independence, but the DOL amended the regulation that year to limit it to the
three current forms of proof. 50 N.J.R. 1026(a) (Mar.19, 2018).

                                                                        A-1500-21
                                       21
      The Commissioner pointed out that in adopting N.J.A.C. 12:16-23.2, the

DOL stated "the entire purpose of the proposed amendment is that the [DOL]

would no longer be conducting its own analysis under the IRS test for

independence in order to determine the existence of a FUTA exemption." 50

N.J.R. 2012(a) (Sept. 17, 2018).     The Commissioner found SSRS did not

establish a FUTA exemption under any of the three methods because the IRS

letter SSRS obtained did "not make a formal finding as to whether [SSRS] has

established a FUTA exemption under the IRS test." Therefore, SSRS was not

exempt from UCL coverage under N.J.S.A. 43:21-19(i)(10).

      The Commissioner also disagreed with the ALJ in her application of the

ABC test. As to prong A, he found "critical aspects of the reporters' work were

controlled by [SSRS]." The Commissioner found SSRS "was responsible for

finding the work in the first place." The company also "negotiated the rate that

was charged to clients without input from the reporters" and "the reporters were

paid whether or not a client pays the company, placing the risk of loss entirely

on the company." SSRS also handled client management, not the reporters

themselves, and "the company performed most of the administrative work of

producing the transcript, billing clients, and scheduling court reporters." The

Commissioner found these characteristics were "indicative of employee status,

as it vests the company with authority over significant formal elements of

                                                                         A-1500-21
                                      22
employment. . . . [SSRS] exercises effective control and direction over the

performance of services."

      Regarding prong B, the Commissioner determined that although the

reporters perform services at remote locations,

             [t]hese services are an integral part of [SSRS]'s
             business, and delivery of services in these locations is
             not a random occurrence. Rather, it is specifically
             determined at the time of acceptance of the contract
             with [SSRS]. These client locations, therefore must
             under Carpet Remnant[, 125 N.J. at 592,] be considered
             an extension of [SSRS]'s place of business, as they
             constitute places "where the enterprise has a physical
             plant or conducts an integral part of its business."

      The Commissioner found SSRS failed to meet prong C of the ABC test,

explaining that when the DOL conducts an audit, it requests a variety of records

from the employer and purported independent contractors, including tax returns,

business cards, invoices, letterhead, advertisements they have taken out,

insurance, and other 1099 records, to ascertain the employment status of the

audited workers. Many of the court reporters SSRS utilized did not respond to

the requests for information. The Commissioner noted, "[f]or the 2006-2008

period, . . . [SSRS] provided documentation that was of little value in rebutting

the presumption of employee status. . . . [SSRS] provided a copy of a Yellow

Pages directory for certified court reporters that listed five of its court reporters

                                                                              A-1500-21
                                         23
on it, as well as sample invoices." 7 The Commissioner observed, "[t]he [DOL]

only received one copy of an IRS Form Schedule C (which is a form submitted

to show profit and loss from a sole proprietorship) for this period." 8 The

Commissioner further observed that if a purported employer did not provide

relevant documents, the DOL "could lawfully infer that the individual was likely

7
    The Commissioner noted,

             [t]he [DOL]'s auditor received calls from three court
             reporters that were no longer with the company, who all
             stated that they never submitted their names to be
             advertised in the Yellow Pages directory, nor submitted
             the invoices presented by [SSRS]. . . . The auditor
             concluded that these invoices were not created by the
             court reporters themselves, but rather were an internal,
             company-created document to determine each
             reporter's weekly pay.
8
    The Commissioner noted:

             Being registered and filing taxes as a business can
             potentially show that an individual has met the C prong,
             though it is not dispositive. A key element of the
             [DOL]'s analysis of a Schedule C [form] is the
             proportion of income that comes from each source, on
             the theory that the greater number of sources of income,
             the more likely that an individual can "continue to exist
             independently of and apart from" his relationship with
             his putative employer, and thereby show that he
             engages in an independent business under the C prong.
             Carpet Remnant[, 125 N.J. at 592-93]. But this single
             Schedule C did not demonstrate independence to the
             auditor's satisfaction.

                                                                         A-1500-21
                                        24
an employee, as no information was provided to rebut the presumption of

employee status."

      Lastly, the Commissioner stated:

                   In order to meet the C prong, it is not enough to
            establish that these reporters could pick up more work
            from another agency. Rather, it must be demonstrated
            that they could "continue to exist independently of and
            apart from" their relationship with [SSRS] as an
            independent business. Carpet Remnant[, 125 N.J.] at
            592. Put another way, these reporters' purportedly
            independent businesses will not "plainly persist despite
            the termination of the challenged relationship," because
            for many of them they were never independent in the
            first place. Trauma Nurses, Inc. v. Board of Review,
            242 N.J. Super. [135,] 142 [(App. Div. 1990)] . . . .

      As a result of finding no UCL exemptions and that SSRS did not meet the

requirements of the ABC test, he ordered SSRS to remit to the DOL $104,116.45

in unpaid unemployment and temporary disability contributions, plus any

interest or penalties that may apply.

                                        B.

      JSR argues its reporters are independent contractors under the ABC test.

It analogizes the facts of this case to Trauma Nurses. It argues reporters are free

to choose when and where to work and are free to work with other agencies.

Moreover, JSR does not perform evaluations, pay any expenses, or provide

practices, procedures, training, equipment, or insurance benefits.

                                                                            A-1500-21
                                        25
      Under prong A, JSR argues it does not exert a significant degree of control

over reporters' work.      For example, reporters can reject work with no

consequences; it provides no direction for the work other than the job's date,

time, and location; and it does not control the kind of equipment used by the

reporter. Further, JSR points out some of the reporters subcontract their wor k.

      Under prong B, JSR compares itself to the agency in Trauma Nurses,

arguing it is a "broker" that places reporters with clients. It argues it merely

facilitates a reporter to attend a proceeding according to the client's needs. As

such, JSR engages reporters to perform work outside of JSR's core business,

which is court reporter brokerage.      JSR also argues the reporters work at

proceedings at attorneys' offices, workers' compensation court, and doctors'

offices, among other places. It further argues the Commissioner's decision is

contrary to the principles in Carpet Remnant and East Bay Drywall, LLC v.

Department of Labor, 251 N.J. 477, 496 (2022). See Carpet Remnant, 125 N.J.

at 592 ("'[P]laces of business' . . . refers only to those locations wher e the

enterprise has a physical plant or conducts an integral part of its business. . . .

[T]he residences of [the business's] customers are clearly 'outside of all the

places of business of [the business].'" (quoting N.J.S.A. 43:21-19(i)(6)(B))).

      JSR argues prong C is satisfied because the reporters have a profession

that will plainly persist despite termination of the work relationship. In the past,

                                                                             A-1500-21
                                        26
it has engaged reporters who previously worked with agencies that went out of

business for the exact same type of work. It also references examples when it

lost a contract, and the reporters were engaged by other agencies. In short, the

reporters "follow the work." JSR further asserts the Commissioner incorrectly

relied on the fact some reporters do not work with multiple agencies. It argues

the standard does not require the reporters to work regularly with other agencies

but asks whether the reporters would get work with other agencies at the end of

their relationship with JSR. 9

       SSRS contests the Commissioner's finding that significant aspects of the

reporters' work were controlled by SSRS and argues it satisfied prong A. It

notes: the court reporters were permitted to turn down assignments without

discipline from the agency; they can work for competitors of SSRS; SSRS does

not supply equipment to court reporters; SSRS does not proofread reporters'

work; only reporters can make corrections to transcripts; and reporters testified

they would continue in their profession if SSRS went out of business. SSRS

also relies on Trauma Nurses, 242 N.J. at 144, where the Court found the nurses

were independent contractors of a nursing agency because the nurses could work

as much or as little as they wanted and were free to work elsewhere.

9
    CCRA advances similar arguments regarding the ABC test.

                                                                          A-1500-21
                                       27
      SSRS argues it satisfied prong B because reporters' services are performed

at law firms, court buildings, meeting halls, and business offices.        SSRS

contends it is clear the reporters' services are performed outside of SSRS's

business enterprise. Further, SSRS has no control over the places where the

services are performed.

      Regarding prong C, SSRS contends the individuals working as reporters

do so in an independently established trade. Multiple reporters testified if a

court reporting agency went out of business, the reporter could obtain work at

another agency. SSRS cites East Bay for the proposition that "[t]he thrust of

prong C broadly asks whether a worker can maintain a business independent of

and apart from the employer." 251 N.J. at 496. Here, SSRS argues the reporters

are not dependent on their agency for finding work and are able to switch

agencies when one closes or a relationship otherwise terminates.

      SSRS also argues they have established a FUTA exemption for the audit

period of 2006-2008. They state prior to 2010, court reporters were exempt from

unemployment tax if: (1) there was a FUTA exemption or (2) the individuals

satisfied the ABC test for independent contractors. SSRS argues it had a FUTA

exemption at the time of the first audit. It asserts evidence of a FUTA exemption

included "[d]ocumentation of responses to the [twenty-point] test[] required by

the [IRS] to meet its criteria for independence." In 2018, the Administrative

                                                                          A-1500-21
                                       28
Code was amended to eliminate the IRS test for independence, but the IR S test

was still in effect during SSRS's audits, so it argues it should be able to use the

test. SSRS argues it would satisfy the IRS test.

      Lastly, SSRS contends that if the court reporters are determined to be

employees, the assessments must be recalculated because there were multiple

delays and stays in the matter over the course of several years, purportedly

through no fault of their own. 10 SSRS argues it would be unjust to assess any

interest or penalties against it for the periods of inaction during the proceedings.

                                          C.

      The scope of our review is narrow. Appellate courts review decisions

"made by an administrative agency entrusted to apply and enforce a statutory

scheme under an enhanced deferential standard." East Bay, 251 N.J. at 493

(citing Hargrove, 220 N.J. at 301-02). That enhanced deference stems, in part,

from "the executive function of administrative agencies." Mazza v. Bd. of Trs.,

Police & Firemen's Ret. Sys., 143 N.J. 22, 25 (1995).                  "An agency's

determination on the merits 'will be sustained unless there is a clear showing

that it is arbitrary, capricious, or unreasonable, or that it lacks fair support in the

10
    The delays included: writing to the IRS; appealing and waiting for a hearing
at the OAL; investigation of a fraudulent letter sent to the IRS; placement of the
case on the inactive list with the OAL three times; and the COVID-19 pandemic
delaying the Commissioner's final decision by twenty-two months.

                                                                                A-1500-21
                                          29
record.'" Saccone v. Bd. of Trs., Police & Firemen's Ret. Sys., 219 N.J. 369,

380 (2014) (quoting Russo v. Bd. of Trs., Police & Firemen's Ret. Sys., 206 N.J.

14, 27 (2011)). The reviewing court "does not substitute its judgment of the

facts for that of an administrative agency." Campbell v. N.J. Racing Comm'n,

169 N.J. 579, 587 (2001) (citation omitted).       Rather, the reviewing court

"defer[s] to matters that lie within the special competence" of the administrative

agency. Balagun v. N.J. Dep't of Corr., 361 N.J. Super. 199, 202 (App. Div.

2003). The party challenging the administrative action bears the burden of

making that showing. Lavezzi v. State, 219 N.J. 163, 171 (2014).

      On appeal, the judicial role in reviewing an administrative action is

generally limited to three inquires:

            (1) whether the agency's action violates express or
            implied legislative policies, that is, did the agency
            follow the law;

            (2) whether the record contains substantial evidence
            to support the findings on which the agency based its
            action; and

            (3) whether in applying the legislative policies to the
            facts, the agency clearly erred in reaching a conclusion
            that could not reasonably have been made on a showing
            of the relevant factors.

            [Allstars Auto Grp., 234 N.J. at 157 (quoting In re
            Stallworth, 208 N.J. 182, 194 (2011)).]

                                                                           A-1500-21
                                       30
"When an agency's decision meets those criteria, then a court owes substantial

deference to the agency's expertise and superior knowledge of a particular field."

In re Herrmann, 192 N.J. 19, 28 (2007). 11

      The statutory framework at issue in this appeal, the UCL, N.J.S.A. 43:21-

1 to -71, "was designed to act as a cushion 'against the shocks and rigors of

unemployment.'" East Bay, 251 N.J. at 494 (quoting Carpet Remnant, 125 N.J.

at 581). Whether a putative employer is required to pay into an unemployment

benefits fund under N.J.S.A. 43:21-7, turns on whether its workers are

employees or independent contractors. Id. at 484-85. Importantly, "[b]ecause

the statute is remedial, its provisions have been construed liberally, permitting

a statutory employer-employee relationship to be found even though that

relationship may not satisfy common-law principles [of employment]." Id. at

494 (second alteration in original) (quoting Carpet Remnant, 125 N.J. at 581).

11
    Furthermore, "where there is substantial evidence in the record to support
more than one regulatory conclusion, it is the agency's choice which governs."
In re Adoption of Amends. to Ne., Upper Raritan, Sussex Cnty., 435 N.J. Super.
571, 583 (App Div. 2014) (quoting Murray v. State Health Benefits Comm'n,
337 N.J. Super. 435, 442 (App. Div. 2001)). "If the Appellate Division is
satisfied after its review that the evidence and the inferences to be drawn
therefrom support the agency head's decision, then it must affirm even if the
court feels that it would have reached a different result itself." Id. at 584
(quoting Clowes v. Terminix Int'l, Inc., 109 N.J. 575, 588 (1988)).

                                                                           A-1500-21
                                       31
      The UCL sets forth the ABC test for making that determination. 12 Id. at

485; N.J.S.A. 43:21-19(i)(6)(A) to (C). Any service performed for renumeration

12
   We limit our discussion to the ABC test in this matter. In the JSR matter, the
ALJ also applied the IRS twenty-point test and the new IRS three-factor test.
The DOL repealed N.J.A.C. 12:16-23.2(a)(4) which previously allowed the use
of the IRS twenty-point test. N.J.A.C. 12:16-23.2(a) (2018). The DOL
determined its prior use of the IRS's tests for independence put it in an
"extremely difficult, if not untenable, position of having to ascertain, without
the benefit of a determination from the IRS" whether its test was met for
particular services. 50 N.J.R. 2012(a) (Sept. 17, 2018). We agree the purpose
of the adoption was for the DOL to stop conducting its own analysis of the IRS
tests to determine if there was a FUTA exemption and required more definitive
findings from the IRS as set forth in N.J.A.C. 12:16-23.2.

      Moreover, under the "time of decision" rule, the Commissioner declined
to apply the IRS test and found the ALJ erred when he applied it. The time of
decision rule applies not only to statutes passed by the Legislature, but also to
regulations enacted by administrative agencies. In such administrative law
contexts, a court will routinely apply a government agency's rules and
regulations as they exist at the time that the case or appeal is decided. See, e.g.,
In re Protest of Coastal Permit Program Rules, 354 N.J. Super. 293, 333 (App.
Div. 2002); Walker v. N.J. Dep't of Insts. & Agencies, 147 N.J. Super. 485, 489
(App. Div. 1977).

       We agree with the Commissioner the time of decision rule applies, and
thus we also do not address the IRS tests for independence as to JSR or SSRS.
Consequently, because JSR did not present any of the three remaining forms of
proof (private letter ruling from the IRS, an IRS audit, or an IRS determination
letter) accepted under N.J.A.C. 12:16-23.2(a) to establish a FUTA exemption,
the Commissioner properly found there was no FUTA exemption. Moreover,
the non-binding IRS letter obtained by SSRS was not a determination letter
under N.J.A.C. 12:16-23.2(a), and therefore did not prove that SSRS had a
FUTA exemption.

                                                                             A-1500-21
                                        32
under any express or implied contract is presumed to be employment unless the

ABC test is satisfied. East Bay, 251 N.J. at 495. The statutory test reads:

            Services performed by an individual for renumeration
            shall be deemed to be employment . . . unless and until
            it is shown to the satisfaction of the [DOL] that:

                   (A) Such individual has been and will
                   continue to be free from control or
                   direction over the performance of such
                   service, both under his contract of service
                   and in fact;

                   (B) Such service is either outside the usual
                   course of the business for which such
                   service is performed, or that such service is
                   performed outside of all the places of
                   business of the enterprise for which such
                   service is performed; and

                   (C) Such individual is customarily engaged
                   in an independently established trade,
                   occupation, profession or business.

            [N.J.S.A. 43:21-19(i)(6).]

      Because the statutory ABC test is formulated in the conjunctive and

presumes that services for renumeration constitute employment, the party

challenging the DOL's determination of an employer-employee relationship has

the burden of "establish[ing] the existence of all three criteria." East Bay, 251

N.J. at 495 (quoting Carpet Remnant, 125 N.J. at 581) (emphasis added). The

ABC test "is fact-sensitive, requiring an evaluation in each case of the substance,

not the form, of the relationship." Id. at 496 (quoting Carpet Remnant, 125 N.J.

                                                                            A-1500-21
                                         33
at 581). "The factfinder must look beyond the employment contract and the

payment method to determine the true nature of the relationship." Ibid.

      Because we conclude below the Commissioner did not act in an arbitrary

or capricious manner in finding JSR and SSRS failed to satisfy prong C, we

defer to the agency decision. Moreover, we confine our analysis to that prong,

and we need not address prongs A and B.13 See id. at 495 (citing Carpet

Remnant, 125 N.J. at 581 (the ABC test is formulated in the conjunctive

requiring the worker to prove all three criteria)).

      Prong C relies on whether the reporters are "customarily engaged in an

independently established trade, occupation, profession or business." N.J.S.A.

43:21-19(i)(6)(C). The Court in East Bay noted, "[p]rong C 'provides the closest

connection between the obligation to pay taxes and the eligibility for benefits.'"

251 N.J. at 496 (quoting Carpet Remnant, 125 N.J. at 589). "[T]he [prong] C

standard is satisfied when a person has a business, trade, occupation, or

profession that will clearly continue despite termination of the challenged

relationship."   Id. at 497 (second alteration in original) (quoting Carpet

Remnant, 125 N.J. at 586). Importantly, "[t]he present tense of the verb, 'is' [as

used in the statute], indicates that the employee must be engaged in such

13
   We do not intimate any views on whether the Commissioner's analysis of
prongs A and B was arbitrary or capricious.

                                                                           A-1500-21
                                        34
independently established activity at the time of rendering the service involved."

Gilchrist v. Div. of Emp. Sec., 48 N.J. Super 147, 158 (App. Div. 1957). Stated

another way, "[i]f the worker 'would join the ranks of the unemployed' when the

relationship ends, the worker cannot be considered independent under prong C."

East Bay, 251 N.J. at 497 (quoting Carpet Remnant, 125 N.J. at 585-86).

      A non-exhaustive list of the relevant factors to consider under prong C

includes: "the duration and strength of the [worker]s' businesses, the number of

customers and their respective volume of business, the number of employees,

and the extent of the [worker]s' tools, equipment, vehicles, and similar

resources."   Carpet Remnant, 125 N.J. at 593.        Moreover, the amount of

renumeration received from the putative employer compared to other sources is

also an important consideration.      Ibid.   Notably, our Supreme Court has

acknowledged that "even wholly dependent employees may choose to work for

more than one employer . . . ." East Bay, 251 N.J. at 498.

      The Commissioner determined JSR and SSRS offered insufficient

evidence to satisfy prong C and rebut the presumption the reporters were

employees, rather than engaged in "a profession that will plainly persist despite

the termination of the challenged relationship." Hargrove, 220 N.J. at 306.

Additionally, the records cited by the Commissioner regarding the court

reporters supported his conclusion the court reporters were not customarily

                                                                           A-1500-21
                                       35
engaged in an independently established business. Moreover, with respect to

JSR, the record supported the Commissioner's finding that many of the reporters

derived all or most of their renumeration from JSR.

      It was JSR's and SSRS's burden to prove prong C. However, JSR only

provided information on less than half of its reporters. SSRS likewise provi ded

very limited information. Moreover, SSRS conceded it "does not know how

often court reporters are working for other agencies." In this regard, the Trauma

Nurses Court's analysis under prong C is distinguishable because there is no

indication that broker failed to provide the Commissioner sufficient information

to evaluate prong C.     Rather, the Court noted those nurses did not work

exclusively through the agency and demonstrated they worked "simultaneously

for other brokers, hospitals and health care institutions." Trauma Nurses, 242

N.J. at 148. Here the Commissioner was not satisfied petitioners established the

reporters were "customarily engaged" in an independent trade at the time of the

audits while rendering services for petitioners due to the insufficient proofs

provided. See Gilchrist, 48 N.J. Super at 158.

      Although JSR argued that the reporters could find work with another

agency if it were to go out of business, the Commissioner rejected this argument

based on the proofs submitted and principles noted above. Despite requests for

information, JSR and SSRS did not provide the DOL sufficient evidence to

                                                                          A-1500-21
                                       36
demonstrate the independence of the reporters. Accordingly, the DOL and the

Commissioner presumed the reporters were employees, as petitioners failed to

rebut the presumption under N.J.S.A. 43:21-19(i)(6).

      The Commissioner noted the reporters' work, despite arguments

otherwise, will not plainly persist because they were never independent in the

first place.   Our role is not to substitute our judgment for that of the

Commissioner. Campbell, 169 N.J. at 587. Rather, we must determine whether

the Commissioner's decision was arbitrary or capricious. In light of petitioners'

burden of proof, there was ample evidence in the record to support the

Commissioner's conclusion as to prong C.          Accordingly, petitioners are

responsible for those assessments imposed by the Commissioner that pre-date

the adoption of N.J.S.A. 43:21-19(i)(10). To the extent we have not addressed

them, any remaining arguments raised by the parties lack sufficient merit to

warrant discussion. R. 2:11-3(e)(1)(E).

      Reversed in part, affirmed in part, and remanded for the Commissioner to

recalculate the amount owed by petitioners consistent with this opinion. 14 We

do not retain jurisdiction.

14
    SSRS asserts it was unfairly assessed certain costs during the lengthy time
period this case was inactive through no fault of its own. The DOL argues there
is nothing in the record to suggest any assessments were attributed to the delays
in adjudicating this matter. Because we are remanding for the assessment to be

                                                                          A-1500-21
                                       37
recalculated consistent with this opinion, to the extent any interest or penalties
were assessed against either petitioner due to delays not caused by them, the
Commissioner shall adjust its final assessment accordingly.
                                                                           A-1500-21
                                       38