Wis.LIRC UC Decision: Akins - March 19, 1998 - PC 713 Hearing, issues for decision - only relevant issue was employe / ind.t contractor -- issue of whether claimant's base-period employment should have been excluded (as commission-paid insurance sales) properly not addressed - party employer in this case is not a base-period employer

STATE OF WISCONSIN
LABOR AND INDUSTRY REVIEW COMMISSION
P O BOX 8126, MADISON, WI 53708-8126 (608/266-9850)

JOAN L AKINS, Employe

PENNSYLVANIA LIFE INS CO, Employer

UNEMPLOYMENT INSURANCE DECISION
Hearing No. 97003964MD

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.

DECISION

The decision of the administrative law judge is affirmed. Accordingly, any wages paid to the employe by the employer shall be reported by the claimant as they are earned.

Dated and mailed: March 19, 1998
akinsjo.usd : 132 : 8 PC 713

/s/ David B. Falstad, Chairman

/s/ Pamela I. Anderson, Commissioner

/s/ James A. Rutkowski, Commissioner

MEMORANDUM OPINION

An initial determination issued August 2, 1997, found that the claimant performed services for the Pennsylvania Life Insurance Company (PLI) as an employe and not as an independent contractor. As a result, the claimant's services constituted employment for unemployment insurance benefit purposes and the claimant was required to report wages from work for PLI as they were earned.

At the hearing, it was established that the claimant worked about two months as an agent for PLI. The claimant worked on a straight commission basis selling life insurance. She began work in May of 1997 and last worked July 18, 1997 (week 29). It was her first experience selling life insurance. The claimant does not have a federal employer identification number and does not intend to apply for one. The claimant did not claim self employment on her taxes in the prior year.

The claimant's services occurred in 1997, accordingly she was subject to the "new" employe definition. Therefore, in order for the claimant to be considered an independent contractor she must have either applied for a federal employer identification number or filed self-employment income tax returns based on such services in the prior year. The undisputed evidence in this case is the claimant does not meet either of the mandatory conditions. Therefore, her services cannot be considered to have been performed in an independent business. The claimant must be considered an employe of PLI for benefit purposes.

PLI's position is that the claimant's employment is excluded because she was an insurance agent paid solely by commissions. Wis. Stat. � 108.02 (15)(k)6. PLI argues that both the initial determination and appeal tribunal decision are in error for focusing on the independent contractor exception rather than on the insurance agent exclusion. PLI is incorrect.

The department investigated the independent contractor versus employe issue because the claimant was filing for benefits while working for PLI. On her weekly claim certification she was certifying that she was self employed. The department needed to investigate whether she was indeed self-employed or whether she was an employe. If she was self-employed she did not have to report her wages and no reduction in benefit eligibility would occur. If she was an employe, however, the wages she earned would reduce her benefit eligibility in each week. As indicated, the claimant is clearly an employe as she has not met the mandatory factors for finding her to be an independent contractor. That was the only issue noticed for hearing and the only issue before the commission.

The department did not and has not investigated the exclusion issue because PLI is not a base period employer. If, in the future, the claimant files for benefits and PLI is a base period employer, the department will investigate whether or not the services performed are in excluded employment. (1 ) However, such a determination is premature. The claimant worked for PLI for only two months. Therefore, PLI is not a base period employer.

The department's determination is limited to finding that, for benefit purposes, the claimant is an employe of PLI. This limitation was noted on the initial determination which stated:

"NOTE: This determination is issued under section 108.09 of the statutes and only resolves the current benefit eligibility issue. Under section 108.101 of the statutes, this decision is not binding for any other purpose and cannot be used to determine whether the employer is liable for contributions based on the services performed by this claimant."

For the above reasons, and for the reasons set forth in the appeal tribunal decision, the commission affirms that decision. (2 )

cc: PENNSYLVANIA LIFE INS CO

ATTORNEY EMILY SPANN
FOLEY & LARDNER

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Footnotes:

(1)( Back ) Wages paid for excluded services cannot be used to qualify for benefits and cannot be used to satisfy requalifying requirements if they are also excluded by FUTA for tax purposes. However, wages from such services are reportable as earnings when such services are reportable as earnings when such services are performed in a week for which a claim for unemployment benefits is filed.

(2)( Back ) In its petition PLI states that if the commission does not find the claimant to be an independent contractor, it wants the commission to direct the appeal tribunal to address a determination issued on August 16, 1997, finding that the claimant quit with the same good cause under Wis. Stat. � 108.04 (7)(e). However, department records indicate that PLI never appealed the August 16, 1997 determination, and that determination has become final.