17. Employee Status

Netmed Transcription Services v Clark – 17.24

Netmed Transcription Services v Clark
Digest No. 17.24

Section 421.42(1) and (5); 421.44(1)

Cite as: Netmed Transcription Services v Clark, unpublished opinion of the Wexford County Circuit Court, issued June 2, 2009 (Docket No. 09-21560-AE).

Appeal pending: No
Claimant: Theresa Clark
Employer: Netmed Transcription Services
Date of decision: June 2, 2009

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HOLDING: A claimant is an employee and not an independent contractor where the claimant’s services are integral to the employer’s business, the claimant depends on wages from the employer for living expenses, the claimant does not operate her own business, and the employer could discharge the claimant, had quality assurance standards and specific deadlines; and required the claimant to contact them to have work assigned.

FACTS:  Claimant worked as a medical transcriptionist for the employer. Despite Claimant being hired as an independent contractor and receiving a 1099, she considered herself an employee. Claimant had to rent a computer from the employer, but the employer provided the software. Claimant had to provide her own reference material, phone, and internet connection. The employer provided clients and required that items were due in 24 hours. Claimant went to her supervisor, Tami Gregg, if she was having any problems or needed to go on vacation. The ALJ found that Claimant was an employee. The Board of Review affirmed.

DECISION: The Circuit Court affirmed the Board of Review’s decision. Claimant is not ineligible for benefits.

RATIONALE:  The Board of Review applied the eight factor test laid out in McKissic v Bodine, 42 Mich App 203 (1972). Factor eight requires the factors to be weighed to “favorable effectuate the purposes of the Michigan Employment Security Act.” In doing so, the Board found that factors two, three, five, and seven predominated in favor of finding that Claimant was an employee.

Factor Two: Claimant’s services were integral to the employer’s business.

Factor Three: Claimant testified that she depended on wages from the employer for living expenses.

Factor Five: Claimant did not operate her own business.

Factor Seven: The employer could discharge Claimant, the employer had quality assurance standards and specific deadlines, and Claimant had to contact the employer for coverage or to have work reassigned.

Digest author: Andrea M. Frailey, Michigan Law, Class of 2017
Digest updated: November 3, 2017

17. Employee Status

Coppens v Hayes – 17.22

Larry Coppens, d/b/a Strawberry Tree & Landscaping v. Matthew L. Hayes
Digest No. 17.22

Section 421.41; Section 421.42

Cite as: Coppens v Hayes, unpublished opinion of the Oakland County Circuit Court, issued October 12, 2005, (Docket No. 05-064176-AE).

Appeal pending: No
Claimant: Matthew L. Hayes
Employer: Larry Coppens, d/b/a Strawberry Tree & Landscaping
Date of decision: October 12, 2005

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HOLDING: The Board of Review’s decision is affirmed. The claimant is eligible for benefits.

FACTS: The claimant did yard work for employer until he was laid off when the employer’s machinery broke down. The UIA found the claimant was a covered employee under the Act. The ALJ agreed and the Board of Review affirmed.

DECISION: Employment relationship was reasonably found because the economic reality test and the definition of employer under MCL 421.41(1)(ii) were both satisfied.

RATIONALE: The Board’s decision was properly supported by evidence and was justified in setting the burden of proof on the claimant. Under the economic reality test’s eight factors, the Board was supported in its finding of an employment relationship because: (1) the employer didn’t incur contractual liability for terminating the claimant; (2) the claimant’s work formed an integral part of the employer’s business; (3) whether the claimant dependent of the job as a means of support was not in evidence and therefore did not factor into the analysis; (4) the employer supplied all the claimant’s work ; (5) there was no evidence the claimant held himself out to the public as ready to perform the relevant job duties; (6) there was not evidence whether the work was customarily performed by an independent contractor so this factor did not factor into the analysis; (7) the employer controlled the claimant’s work by telling him how he would be paid, when to report to work, and what to do; and (8) the purpose of the Act and deference to the agency supported the finding of the employment relationship.

The court also found an employment relationship was present under the definition of “employer” under MCL 421.41(1)(ii)  since the employer paid a total remuneration of $1000 or more per year.

Digest author: Austin L. Webbert, Michigan Law, Class of 2017
Digest updated: October 25, 2017