DANIEL L LISOWSKI, Applicant

JEFFERY RIECK DBA RIECK & SON, Employer

WIS WC UEF, Insurer

An administrative law judge (ALJ) for the Worker's Compensation Division of the Department of Workforce Development issued a decision in this matter. A timely petition for review was filed both by attorney for Rieck & Son and the attorney for the Wis. WC UEF. However, the attorney for the Wis. WC UEF subsequently withdrew its petition and did not submit a brief on this matter.

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 order in that decision as its own.

The findings and order of the administrative law judge are affirmed.

Dated and mailed
September 29, 2011
lisowda:150:6  ND6 2.2

BY THE COMMISSION:

/s/ Robert Glaser, Chairperson

/s/ Ann L. Crump, Commissioner

/s/ Laurie R. McCallum, Commissioner

Rieck & Son petitioned the ALJ's decision, contending that the ALJ erred in finding Rieck & Son to be an employer subject to the Worker's Compensation Act. Specifically, Rieck & Son argued that the ALJ inaccurately applied the burden of proof and, in doing so, reached the incorrect conclusion that Rieck & Son was an employer subject to Chapter 102.

The applicant performed services for Rieck & Son beginning in the fall of 2008 and was injured while working for Rieck & Son on January 2, 2009.

Wisconsin Statutes § 102.03(1)(b) provides that an employer is liable only where, at the time of injury, both the employer and employee are subject to the provisions of Wisconsin worker's compensation law. The Wisconsin Supreme Court recently touched upon burden of proof issue in Acuity Mutual Ins. Co. v. Olivas, 2007 WI 12, 298 Wis. 2d 640. While the Acuity case was tried on one party's contractual liability for premiums as an insured of the other party and the case did not arise under Wis. Stat. ch. 102 on an injured worker's claim for worker's compensation, the Acuity court observed:

Older worker's compensation cases declare that the party seeking to defeat worker's compensation bears the burden to prove facts supporting its position. More recently the court has disavowed this declaration and has ruled that an applicant has the burden to prove that he or she is an employee and that the issue whether the applicant might be an independent contractor does not present an affirmative defense. [Footnotes omitted]

Acuity, at 298 Wis. 2d 37, 298 Wis. 2d 656.

Wisconsin Statutes § 102.04(1)(b) defines "employer subject to the provisions of this chapter" to include:

1. Every person who usually employs 3 or more employees for services performed in this state, whether in one or more trades, businesses, professions, or occupations, and whether in one or more locations.102.04(1)(b)2.

2. Every person who usually employs less than 3 employees, provided the person has paid wages of $500 or more in any calendar quarter for services performed in this state. Such employer shall become subject on the 10th day of the month next succeeding such quarter.

At the same time the applicant provided services for Rieck & Son, two other individuals (Ricky Holdstad and Terry Rieck) were also working on the same construction jobs for Rieck & Son. Holdstad began receiving pay for work from Rieck & Son beginning in 2006, while Terry Rieck first received a 1099 for services in 2007. Evidence was not offered by Rieck & Son as to the amounts paid to each in each quarter. For each job worked, Rieck & Son provided tools, materials and assigned the work. Despite claims of written signed independent contractor agreements, none were offered as exhibits. Similarly, no proof of liability insurance was presented for any of the workers. Rieck & Son disputed the applicant's testimony regarding the discussions regarding work and payment and, although Rieck & Son brought the other workers to the hearing, they were not questioned regarding the relationship, their specific wages or the work they performed for Rieck & Son or others, if applicable.

The commission follows the principle that a trier of fact may draw an adverse inference when a party in possession of evidence fails to produce the evidence and fails to offer an explanation for failing to produce it. See 2 Wigmore, Evidence § 285, at 162 (3d ed. 1940); see Wisconsin Worker's Compensation Uninsured Employees Fund v. Urban Artifacts, Inc., Case No. 99-2413, (Wis. Ct. App., May 9, 2000), affirming Robert Wilson v. Urban Artifacts, WC Claim No. 98000072 (LIRC, February 24, 1999). Additionally, in Jensen v. Harold Martin Roofing and Wis. WC UEF, WC Claim No. 97005804 (LIRC April 28, 1998) the commission declined to apply the burden of proof to shield the employer "from its liability for benefits by failing to bring records to the hearing which would settle the issue at best or rebut the applicant's hearing testimony on the issue at least."

Although the petitioner argued that Jensen was not applicable, the commission disagrees; Rieck & Son failed to provide specific evidence regarding agreements, insurance and payment arrangements. The ALJ credited the applicant's testimony as does the commission. Thus, the commission disagrees with the petitioner's argument that the burden was unjustly placed; instead, the commission finds that the applicant presented sufficient credible evidence to establish Rieck & Son was subject based upon his payment of wages to employees, Holstad and Terry Rieck, and that the burden had shifted to Rieck & Son. Rieck & Son failed to rebut this and the ALJ properly found it to be an employer subject to Chapter 102 as of the time of the injury.

cc: Attorney Stephan Rogge
Attorney Angela McKenzie
Attorney Melissa Kirschner

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