Court Opinion

ID: 5366150
Source: CourtListenerOpinion
Date Created: 2022-01-08 07:48:19.977816+00
Date Added: 2024-06-11T08:29:57.068928
License: Public Domain

Hill, P. J.
(dissenting). The Court of Appeals (284 N. Y. 167) reversed the order of this court (259 App. Div. 771) and reinstated the decision of the Appeal Board, which determined, “ Appellant is liable for contributions upon the earnings of claimant and all similar employees” Thereafter the Court of Appeals denied a motion to amend the remittitur by striking out the words “ and all similar employees.” The order stated: “ The respondent expressly withdrew the question which by amendment to the remittitur it now asks the court to decide. This court has not passed upon that question and it may be argued in the court below.” (See 284 N. Y. 738.) Adopting the suggestion of that order, this court has now heard argument as to the jurisdiction of the Unemployment Insurance Appeal Board to determine in this proceeding that appellant, the Spirella Company, Inc., is hable for contributions under the Unemployment Insurance Act on account of all the persons whose contracts are similar to that of the claimant, Margaret B. Morton. It is well to recite that it has been finally determined by the court of last resort that Margaret B. Morton was an employee of appellant within the purview of article 18 of the Labor Law, and the only issue now to be determined is whether, in this proceeding wherein it was determined that she was an employee, the Appeal Board had jurisdiction to determine the status of “ all similar employees,” and to determine that appellant should make contributions on account of those similarly situated.
This proceeding was brought under section 510 of the Labor Law. The claimant Morton filed an “ original claim for benefits ” dated November 23, 1938, as required by that section. The only appearances at the hearings which began March 15, 1939, were on behalf of claimant Morton and the appellant. Following the hearings the referee made a decision: “ I find the Spirella Company, Inc., is the employer of the claimant * * * within the meaning of the law. I further find that the Spirella Company, Inc., is subject to pay contributions to the New York State Unemployment Insurance Fund, on the claimant’s earnings, which was the difference *409between the wholesale price charged claimant and the retail price charged the customer.” In the decision by the Appeal Board dated July 27, 1939, the words “ and all similar employees ” first appeared. Section 510 of the act has been amended since the commencement of the proceeding; but at all times it has governed the presentation of a claim by an unemployed person. Section 523 now, as at the commencement of this proceeding, states the procedure to be followed in the event an employer fails to file a report for the purpose of determining the amount of his contribution under the act, and outlines the necessary steps which shall precede the Commissioner’s determination of the amount of the contribution or tax. The Appeal Board in the decision herein stated: “ The sole question to be determined by the Board is whether the relationship between appellant [the Spirella Company, Inc.] and claimant [Margaret B. Morton] was that of employer and employee, or whether claimant was an independent contractor.” The Board improperly purported to determine matters not involved in this proceeding brought under section 510 of the Labor Law. That section deals only with claims for benefits presented by alleged employees, and in proceedings thereunder the Commissioner may not determine the amount of contributions to be made by the alleged employer. This statute differs from workmen’s compensation whereunder the amounts paid by an employer on account of an injury go directly to or are earmarked for the benefit of a specified injured employee. “ The Unemployment Insurance Fund ” was created, consisting of taxes paid by the employer and employee and deposits made by the National and State governments. The fact that an employer has contributed on behalf of an employee and that the employee likewise has contributed gives to the latter no right to his own contributions or those made on his behalf. An unemployed person may benefit only in the event his claim is allowed in a proceeding brought under the last-mentioned section, and then the benefits are paid from the general fund. A great majority of the contributing employees and upon whose behalf employers may have paid large sums, will never receive a benefit on account of 'unemployment. Section 523 deals with the collection of contributions from employers in a manner somewhat comparable with the collection of other taxes paid directly to the State. Conditions precedent to the determination by the Commissioner as to the amount of the payroll tax or contributions are prescribed therein. This record does not disclose that either the Commissioner or the Appeal Board had jurisdiction to make the determination contained in the following quoted portion of the decision by the Board: “Appellant is liable for contributions upon the earnings *410of claimant and all similar employees.” The portion, however, that deals with claimant alone may be regarded as surplusage, for the liability of the employer as to claimant would certainly follow a determination that the relation of employer and employee existed. This proceeding had to do with the right of the claimant to benefits, and not with the assessment of the payroll tax against the employer.
The proceeding should be remitted to the Appeal Board for the sole purpose of striking from the paragraph headed “ Decision ” the words “ and all similar employees,” with fifty dollars costs and disbursements payable by the Industrial Commissioner to the appellant.
Crapser, J., concurs.
The Referee and the Appeal Board had jurisdiction to determine that claimant was an employee of appellant. Enter order in accordance with the prevailing opinion, with costs to the Industrial Commissioner.