Court Opinion

ID: 6553118
Source: CourtListenerOpinion
Date Created: 2022-07-19 22:30:50.2112+00
Date Added: 2024-06-11T15:56:09.633822
License: Public Domain

Margaret Meads, Judge, concurring. I concur in the decision we reach in this case, because I believe our standard of review permits no other result. I write separately, however, to express my belief that the statutory requirements for an employer to establish an exemption from paying unemployment insurance taxes have been made so stringent that no employer can ever meet them. Under former law, services performed by an individual for wages were deemed to be employment subject to the Arkansas Employment Security Act unless and until it was shown, to the satisfaction of the Commissioner of Labor, that: A. such individual has been and will continue to be free from control or direction over the performance of such services, both under his contract of service and in fact; or that 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; or that C. such individual is customarily engaged in an independendy established trade, occupation, profession, or business; provided, however, this act shall be construed to apply only where the legal relationship of master and servant exists; and independent contractors, as defined by the common law of the State, shall be deemed employers, or the employing unit, and not employees; the foregoing definition governing employment relationship shall apply solely for the purpose of the administration of this act and for no other purpose. The statutory employee created by this act shall not abrogate the common law definition of master and servant as the same applies in actions in tort, nor shall the supervision and control required for the purposes of this act to be exercised by an employing unit over said statutory employees be admissible in actions in tort. (Emphasis added.) Ark. Stat. Ann. § 81-1103(i)(5)(1960); see also Crossett Lumber Co. v. McCain, 205 Ark. 631, 170 S.W.2d 64 (1943). This statute was amended by Act 35 of 1971, and is now codified as Ark. Code Ann. § ll-10-210(e), which provides: (E) Service performed by an individual for wages shall be deemed to be employment subject to this Act irrespective of whether the common-law relationship of master and servant exists, unless and until it is shown to the satisfaction of the commissioner that — (1) such individual has been and will continue to be free from control and direction in connection with the performance of such service, both under his contract for the performance of service and in fact; and (2) such service is performed either outside the usual course of the business for which the service is performed or is performed outside of all the places of business of the enterprise for which the service is performed; and (3) such individual is customarily engaged in an independently established trade, occupation, profession, or business of the same nature as that involved in the service performed. (Emphasis added.) As stated in Morris v. Everett, 7 Ark. App. 243, 647 S.W.2d 476 (1983), by passing Act 35, the General Assembly intended to make it more difficult to claim an exemption; Act 35 joined the foregoing subdivisions with the conjunction “and,” thereby requiring a person to show all three before obtaining an exemption. The significant facts of this case are recited in the prevailing opinion. Despite the Board of Review’s conclusion that appellant proved none of the three requirements of Ark. Code Ann. § 11-10-210(e), I believe appellant clearly established the first two requirements. With regard to subsection (1), I am convinced that the demonstrators are completely free from any control or direction by appellant in performing their assigned food demonstrations. Appellant simply procures a demonstrator and advises her of the date to show up at a designated store. Beyond that, the demonstrator’s work is totally self-directed. The Board of Review points to the fact that unsatisfactory performance by a demonstrator can result in no future assignments, which is “ultimate control.” I disagree. There is no guarantee that appellant will ever call a demonstrator for future assignments, even if she is “the best.” Moreover, there was no proof that appellant even followed up to determine whether a demonstrator performed her work satisfactorily or unsatisfactorily. With regard to subsection (2), the evidence showed that appellant’s actual business enterprise is the procuring of demonstrators pursuant to a vendor’s request; that Mrs. Dorris conducts this business enterprise from her home and from no other location; and that no demonstrations are conducted at Mrs. Dorris’s home. Thus, the service performed, demonstrating, is indeed “performed outside of all the places of business of the enterprise for which the service is performed.” Ark. Code Ann. § ll-10-210(e)(2)(Supp. 1999). Although I realize that present law requires an employer to prove all three requirements in section ll-10-210(e) in order to be exempt, and appellant has been unable to do so, I find it difficult to imagine an “employment” relationship more deserving of exemption than this. Under former law, appellant would have established her case for exemption by proving either of the first two requirements. Moreover, I would find it incredulous to learn that one of appellant’s demonstrators, electing not to accept further assignments, sought and actually received unemployment benefits.