JEFF BAUMGARTEN, Employer

An administrative law judge (ALJ) for the Division of Unemployment Insurance of the Department of Workforce Development issued a decision in this matter. A timely petition for review was filed.

The commission has considered the petition and the positions of the parties, and it has reviewed the evidence submitted to the ALJ. Based on its review, the commission agrees with the decision of the ALJ, and it adopts the findings and conclusion in that decision as its own.

The decision of the administrative law judge is affirmed. Accordingly, the employer is liable for additional taxes in the 1st through 3rd quarters of 2003 and the 1st and 2nd quarters of 2004 in the total amount of $2,526.44, plus additional interest as allowed under the applicable statute.

Dated and mailed March 23, 2006
baumgje . ssd : 132 : 4   PC 770  EE 410

/s/ James T. Flynn, Chairman

/s/ David B. Falstad, Commissioner

/s/ Robert Glaser, Commissioner

The employer has petitioned for review of the appeal tribunal decision that found the individuals at issue performed services for the employer as employees and not as independent contractors. The commission has reviewed the record and agrees with the administrative law judge's Findings of Fact and Conclusions of Law.

First, the employer does not have a right to a trial by jury. The commission noted in Nettleton Logging Inc., UI Dec. Hearing No. S9000138HA (LIRC Feb. 28, 1992):

. . . the appellant is not entitled to a jury trial in an unemployment compensation proceeding. Unemployment compensation is a statutorily created program. The Statute, Chapter 108, Stats., provides for due process in a disputed claim with an administrative hearing, commission review of its decision, and finally judicial review. There is no provision in this chapter for a jury trial. The employer has no constitutional right to a jury trial because the unemployment compensation program was created after the state and federal constitutions were adopted. "Neither the state nor the federal constitutions guarantee or preserve the right of trial by jury except in those cases where it existed when the constitutions were adopted, and cases substantially similar thereto, and the constitutional guarantee does not apply to a statutory proceeding not in the nature of a suit at common law." 1 Am. Jur. 2d Administrative Law sec. 153; General D. & H. Union v. Wisconsin E.R. Board, 21 Wis. 2d 242, 252, 124 N.W. 2d 123 (1963).

The employer questions the impartiality of the ALJ as a department employee. However, the unemployment insurance law also states that the department shall establish appeal tribunals to hear issues arising under ch. 108 regarding the status or liability of an employing unit. Further, the commission conducts an independent review of the decision of the appeal tribunal.

The employer asserts that it is the state's responsibility to ask the individuals how they run their businesses and not the employer's responsibility, as it is a personal matter and not businesslike. The appellant also states "when none of the 6 people have ever filed the burden of proof became the states." The commission is not quite sure what the employer means by none of the individuals having filed, but it disagrees that the department bears any burden beyond its burden of establishing that the individuals performed services for the employer for pay. Once that burden has been met, it is the employer's burden to establish that such services were performed as independent contractors, not as employees. It is the employer's obligation to establish that seven of the ten conditions set forth in Wis. Stat. § 108.02(12)(bm) have been satisfied.

The employer argues that the cost of the drywall was not an expense associated with the services performed. However, even if the condition was resolved in the employer's favor, the employer still fell well short of establishing that seven of the ten statutory conditions were satisfied.

For the above reasons, the commission agrees with the ALJ that the employer failed to establish that the individuals at issue performed services for the employer as independent contractors. Accordingly, the commission affirms the appeal tribunal decision.

cc:
Baumgarten Drywall Inc.
Accountant Richard P. Toellner

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uploaded 2006/03/27