GARY L HANKS, Claimant

AMERICABLE MEDIA GROUP INC, 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 base period wages paid to the claimant by the employer totaling $17,709.00 ($31,117.00 during the alternate base period) shall be included in the department's computation of benefit eligibility, as more specifically set forth in the determination.

Dated and mailed April 28, 2004
hanksga . usd : 150 : 1   EE 410 EE 410.03  EE 410.04a  EE 410.04b  EE 410.07

/s/ David B. Falstad, Chairman

/s/ James T. Flynn, Commissioner

/s/ Robert Glaser, Commissioner

Americable Media Group, Inc. petitioned the appeal tribunal decision, arguing that the claimant's services were not performed as an employee for unemployment insurance benefit purposes. Since the claimant performed services for the petitioner for pay, the petitioner must establish that at least seven of the ten criteria set forth under Wis. Stat. § 108.02(12)(bm) were met in order to prevail.

The commission agrees with the petitioner and the administrative law judge that the first two criteria were met. Specifically, the claimant performed similar services in the past, albeit with other cable businesses, and filed self-employment taxes for those services. Additionally, he does hold a federal employer identification number.

Next, although the petitioner argued that the claimant met the third criterion of maintaining a separate business with his own office, equipment, materials and other facilities, the commission disagrees. In particular, all parts of this test must be considered in determining whether it is met. Quality Communication Specialist, Inc. UI Dec. Hearing Nos. S0000094MW and S0000095MW (LIRC July 30, 2001). While the claimant did have a home office, he did not claim a home office deduction. He did have some equipment but the cable business with which the petitioner contracted supplied the materials that he needed to perform his work. The claimant did not have a business name or advertise and, in fact, his only means of identification were magnetic stickers that he attached to his personal vehicle indicating that he worked as a contractor for the cable business. As such, the commission agrees with the administrative law judge that the claimant did not maintain a separate business from the petitioner.

The fourth criterion, whether the claimant operated under contracts to perform specific services for specific amounts of money and under which he controlled the means and methods of performing such services, has two specific parts. While the claimant was operating under one contract during the period of time that he performed services for the petitioner, the commission has held that the existence of multiple serial contracts may meet the first part of this test if the contracts are shown to have been negotiated "at arms length." T & D Coils, Inc., UI Dec. Hearing No. S9800147MW (LIRC December 15, 1999). Yet the evidence in this case does not support a finding that these contracts were negotiated at arms length. To the contrary, the terms were set by the petitioner and modified at will by it. The claimant had no bargaining power. Consequently, the petitioner fails to establish the first part of this two-part test. As far as the second part of this test is concerned, it does not matter whether the petitioner or someone else controlled the means or methods of the services, if it is not the claimant, the test is not met. See Quality Communications Specialist, Inc. Although the petitioner argues that the claimant had the right to control the work he did and that may have been true as to his choice of where to put a ladder or a line, it is not true for anything else. He was told where to go, what to do when there and was to record his work on the petitioner's work sheets. He was also subject to quality inspections and was required to carry certain types of insurance at the petitioner's direction. As such, this criterion is also not met.

The fifth criterion, whether the claimant incurred the main expenses related to the services that he performed under contract with the petitioner was also not established. Specifically, in Quality Communications Specialist, Inc., the commission factored in depreciation for equipment to reduce the actual business costs and found that the materials were an important part of the cost comparison. There was no such detailed evidence in the record of this matter and, therefore, the petitioner failed to meet its burden on this criterion.

Given the claimant's responsibility to fix a job and, if it was not fixed correctly, the chance that he might not be paid or could be charged a penalty by the petitioner; the sixth criterion, that the claimant was responsible for satisfactory competition of the services that he was contracted to perform and was liable for the failure to satisfactorily complete the services was met.

With respect to the seventh criterion, whether the claimant received compensation for services under a contract on a commission or per job or competitive bid basis, clearly he was not paid on a commission or a competitive bid basis. In reference to a "per job" payment, the legislature clearly intended a situation in which an independent business person enters into a contract to do an entire job of some kind for which a price is set, and for which the price has presumably been arrived at by the parties' negotiation for the job contracted for. See Quality Communications Specialist, Inc. Because the claimant has no negotiation power in the price that is paid per job and is not able to change the price per job through negotiation, this is also not met.

The eighth criterion asks both whether a business faces an actual possibility of making a profit and an actual possibility of suffering a loss. See Quality Communications Specialists, Inc. Clearly, the evidence shows profit is possible. The administrative law judge also found that it was theoretically possible for the claimant to sustain a loss. While the record is limited, the commission agrees with this finding given the possibility that the claimant may be charged a penalty for failure to adequately perform the services.

The claimant did have recurring business liabilities or obligations, and, therefore, the ninth criterion is met.

Finally, the tenth criterion contemplates the existence of a genuine business endeavor; "in an entrepreneurial sense, a significant investment is put at risk and there is thus the potential for real success as the growth and value of the investment or real failure in the sense of actual loss of the investment." See Dane County Hockey Officials, UI Dec. Hearing No. S9800101MD (LIRC, February 22, 2000). The record is insufficient to establish any such "success" or "failure." In Prince Cable, Inc., UI Hearing No. S9900227MW (LIRC, February 23, 2001), the commission held that installers received piece rate compensation, determined per tasks, for many assignments taken, subject to reduction from satisfactory performance, leading the commission to conclude that there was no proof of a genuine business endeavor. The facts are similar in this case.

In conclusion, the petitioner failed to establish that seven of the ten criteria were met and, thus, the commission affirms the appeal tribunal decision.

cc: Attorney Mark J. Goldstein Esq.

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