Court Opinion

ID: 7959704
Source: CourtListenerOpinion
Date Created: 2022-09-09 00:32:11.624304+00
Date Added: 2024-06-11T16:34:20.355733
License: Public Domain

Per Curiam.
The Michigan Employment Security Commission appeals from a circuit court order allowing Seligman & Associates, Inc., a refund for contributions paid to the mesc on the value of lodging provided to its resident caretakers. Seligman, a Michigan employer, operates numerous apartment complexes and employs caretakers or managers at these complexes. The caretakers are *509provided rent-free apartments as part of their employment, and they are required to live on the premises to handle tenant complaints which might arise.
Under the Michigan Employment Security Act, MCL 421.1 et seq., MSA 17.501 et seq., Seligman, as an employer, is required to pay taxes on the wages paid to its employees. The issue presented here concerns whether the value of lodging provided by Seligman for its resident caretakers is considered wages for the purposes of mesa.
In July, 1982, the mesc issued a notice of assessment in the amount of $18,477.87, reflecting the value of the apartments provided by Seligman for its caretakers for the fourth quarter of 1981 and the first quarter of 1982. Seligman filed a protest of the assessment, and the mesc affirmed the notice of assessment in a redetermination issued in August, 1982. Seligman appealed the redetermination, and in a May, 1984, decision, an mesc hearing referee affirmed. Seligman appealed the hearing referee’s decision to the circuit court which reversed the referee’s decision and ordered a refund to Seligman. The mesc now appeals. Seligman has filed a cross-appeal seeking interest on the contributions refunded by the mesc. We affirm the ruling of the trial court and hold that the lodging provided to Seligman’s resident caretakers is not considered wages for the purposes of mesa.
The controversy centers on the definition of wages under mesa. At the time the dispute arose, MCL 421.44(2); MSA 17.548(2) provided:1
"Wages”, subject to subsections (3) to (5), means remuneration paid by employers for employment.
*510Remuneration was defined in MCL 421.44(1); MSA 17.548(1) as follows:
"Remuneration” means all compensation paid for personal services, including commissions and bonuses, and except for agricultural and domestic services, the cash value of all compensation payable in a medium other than cash. Any remuneration payable to an individual which has not been actually received by that individual within 21 days after the end of the pay period in which the remuneration was earned, shall, for the purposes of subsections (2) to (5), be considered to have been paid on the twenty-first day after the end of that pay period. The reasonable cash value of compensation payable in a medium other than cash, shall be estimated and determined in accordance with rules promulgated by the commission. "Remuneration” shall not include money paid an individual by a unit of government for services rendered as a member of the national guard of this state, or for similar services to any state or the United States.
In addition, the mesc has promulgated the following rules:
(1) If board, rent, housing, lodging, meals, or similar advantage is extended in a medium other than cash as partial or entire remuneration for service constituting "employment” as defined in section 42 of the act, then the reasonable cash value of same shall be deemed wages. However, for purposes of this rule, payments in any medium other than cash shall not apply to agricultural or domestic service, except for purposes of subrule (6) of this rule.
(2) Where the cash value for such board, rent, housing, lodging, meals, or similar advantage is agreed upon in any contract of hire, the amount so agreed upon shall be deemed the value of such board, rent, housing, lodging, meals, or similar advantage. Check stubs, pay envelopes, and the *511like furnished to employees setting forth such cash value, are acceptable evidence as to the amount of the cash value agreed upon in any contract of hire, except as provided in subrules (4) and (5) of this rule.
(3) In the absence of such an agreement in a contract of hire, the rate for board, rent, housing, lodging, meals, or similar advantage, furnished in addition to money wages or wholly comprising the wages of an employed individual, shall be deemed to have the following cash value, except as provided in subrule (4):
Full board and room per week........$29.00
Meals (without lodging) per week..... 19.50
Meals (without lodging) per day....... 3.25
Meals (without lodging) per meal..... 1.00
Lodging (without meals) per week..... 9.75
Lodging (without meals) per day...... 1.50
However, when lodging is furnished, for example, to superintendents of properties, caretakers, and janitors, the value of such lodging shall be the amount that would be paid by such an employee for similar or equivalent accommodations furnished by an individual other than his employer. [1980 AACS, R 421.112.]
Under 1980 AACS, R 421.112 the reasonable cash value of lodging is only deemed to be wages if it is extended as partial or entire remuneration for services rendered. Such is not the case here. We have reviewed the stipulated facts and conclude that the lodging provided by Seligman to its caretakers is provided solely for the convenience of the employer. The lodging is not extended as partial remuneration for services rendered. The parties stipulated that "Seligman has many employees who act as Caretakers or managers of the various apartment complexes. These employees are provided the use of a rent-free apartment in connection with their employment.” Further, "Seligman requires these employees to live on the premises *512for its own convenience so that the employees will be available to handle tenant complaints or other problems which can arise at any time.” There was nothing in the stipulated facts indicating that the rent-free lodging was intended as partial remuneration for the employees. There was no indication of what compensation was received by the caretakers or whether they would have received additional compensation if they were not required to live on the premises.
A hearing referee’s decision will not be disturbed unless it is contrary to the law or unsupported by competent, material, and substantial evidence. MCL 421.38; MSA 17.540; Carpet Cleaning & Dye Co, Inc v Employment Security Comm, 143 Mich App 287, 291; 372 NW2d 332 (1985). We conclude that the hearing referee’s decision, finding that the lodging provided constituted remuneration, was unsupported by competent, material, and substantial evidence. Nothing in the record indicates that lodging was provided as partial remuneration; rather, the parties stipulated that lodging was provided for the convenience of the employer. The circuit court did not err in reversing the hearing referee’s decision.
This interpretation of the definition of wages under mesa is consistent with the United States Supreme Court’s interpretation of the definition of wages under the Federal Unemployment Tax Act in Rowan Co, Inc v United States, 452 US 247; 101 S Ct 2288; 68 L Ed 2d 814 (1981). In Rowan, the Supreme Court held that for the purposes of that act wages do not include the value of meals and lodging provided for the convenience of the employer.
Seligman raises one issue in its cross-appeal. Seligman argues that it is entitled to receive interest on the contributions refunded by the mesc. We *513find that Seligman has failed to properly preserve this issue for appeal. Seligman failed to raise the issue of interest in the administrative proceedings below; thus, appellate review is precluded. Ackerberg v Grant Community Hospital, 138 Mich App 295, 299; 360 NW2d 599 (1984).
The order of the circuit court granting Seligman a refund for contributions paid to the mesc is affirmed.

 MCL 421.44; MSA 17.548 has been amended by 1982 PA 535 and 1985 PA 223; however, the portions of the statute pertinent to resolution of this dispute remain in effect.