Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

Standard Oil of Connecticut Inc. v. Adm'r, Unemployment Compensation Act

Supreme Court of Connecticut

March 15, 2016

STANDARD OIL OF CONNECTICUT, INC.
v.
ADMINISTRATOR, UNEMPLOYMENT COMPENSATION ACT

         Argued October 15, 2015.

          Appeal from the decision of the Employment Security Appeals Division, Board of Review, upholding the decision of an appeals referee, which affirmed the determination of the defendant that certain persons who had performed services for the plaintiff were the plaintiff's employees, brought to the Superior Court in the judicial district of Fairfield and tried to the court, Hon. Richard P. Gilardi, judge trial referee, who, exercising the powers of the Superior Court, rendered judgment dismissing the plaintiff's appeal, from which the plaintiff appealed.

          SYLLABUS

         Pursuant to the provision (§ 31-222 [a] [B] [ii]) of the Unemployment Compensation Act (§ 31-222 et seq.) setting forth the three-pronged " ABC" test for determining whether an individual is an employee or an independent contractor for purposes of the act, service performed by the individual shall be deemed to be employment unless it is shown that such individual is " free from control and direction in connection with the performance of such service" (part A) or unless it is shown that such service " is performed outside of all the places of business of the enterprise for which the service is performed" (part B).

         The plaintiff, S Co., appealed from the trial court's judgment dismissing its appeal from the decision of the Board of Review of the Employment Security Appeals Division, which concluded that certain individuals who had worked for S Co. as installers of security systems and heating and cooling systems, or as service technicians, were S Co.'s employees under the Unemployment Compensation Act. S Co. made installation and service appointments with its customers, with whom S Co. contracted directly, and then sought an installer or technician who would be willing to perform the service or installation. The appeals stemmed from a determination by the defendant, the administrator of the Unemployment Compensation Act, that S Co. had misclassified the installers and technicians as independent contractors rather than as employees and that S Co. therefore owed more than $41,000 in unemployment contribution taxes plus interest for 2007 and 2008. An appeals referee upheld the defendant's determination, and S Co. appealed to the Board of Review, which determined, consistent with the appeals referee, that the installers and technicians were employees of S Co. The Board of Review concluded that, although S Co. had established that the installers and technicians were independent contractors for purposes of part C of the ABC test, S Co. failed to demonstrate that they were independent contractors under parts A and B. S Co. then appealed to the trial court, which dismissed its appeal. On S Co.'s appeal from the trial court's judgment, in which S Co. challenged the determination with respect to parts A and B of the ABC test, held that the trial court improperly determined that the installers and technicians were S Co.'s employees under parts A and B of the ABC test, and, therefore, the trial court's judgment was reversed and the case was remanded to that court with direction to sustain S Co.'s appeal:

         1. S Co. satisfied its burden of demonstrating that the installers and technicians were free from its control and direction under part A of the ABC test and, therefore, were independent contractors for purposes of that part of the test; the contracts between S Co. and its installers and technicians provided that they would exercise independent judgment and control in the execution of any work they performed for S Co., S Co. did not train or instruct the installers and technicians, the installers and technicians were not supervised by S Co. at the customers' homes, S Co. did not inspect their work or have a representative on the customers' premises when the installers and technicians were working, the installers and technicians were free to accept or reject any assignment offered to them by S Co., they could realize a profit or a loss depending on the difficulty of the particular job, they used their own equipment and tools to complete each project, they were permitted to hire assistants whom they could supervise, they were not required to display S Co.'s name on their work clothing or utility vehicles, and, although S Co. imposed certain limitations on the installers and technicians, those limitations did not have any bearing on whether S Co. exercised control and direction over the manner in which they performed their work at the homes of S Co.'s customers.

         2. Contrary to the trial court's conclusion, the homes of S Co.'s customers at which the installers and technicians worked were not places of business under the ABC test when S Co. did not supervise their work there, and, therefore, the installers and technicians were independent contractors for purposes of part B of the ABC test; this court concluded, on the basis of its review of case law and its examination of the broader statutory scheme, that the trial court's interpretation of the term " places of business" in part B of the ABC test as including the homes of S Co.'s customers was unreasonably broad and inconsistent with the purpose of the act and that a reviewing court should consider the extent to which a purported employer exercises control over the location where the individual performs the work in determining whether that location constitutes a place of business for purposes of part B of the ABC test.

         Glenn A. Duhl, with whom was Angelica M. Wilson, for the appellant (plaintiff).

         Thomas P. Clifford III, assistant attorney general, with whom were Krista Dotson O'Brien, assistant attorney general, and, on the brief, George Jepsen, attorney general, and Phillip M. Schulz, assistant attorney general, for the appellee (defendant).

         Michael C. Harrington and Jennifer A. Corvo filed a brief for the Connecticut Business and Industry Association, Inc., as amicus curiae.

         Rogers, C. J., and Palmer, Zarella, Eveleigh, McDonald, Espinosa and Robinson, Js. ZARELLA, J. In this opinion EVELEIGH, ESPINOSA and ROBINSON, Js., concurred. ROGERS, C. J., with whom PALMER and McDONALD, Js., join, dissenting.

          OPINION

          [320 Conn. 613] ZARELLA, J.

          The plaintiff, Standard Oil of Connecticut, Inc., appeals from the judgment of the trial court dismissing its appeal from the decision of the Employment Security Appeals Division, Board of Review (board). The board denied in part the plaintiff's motion to correct findings of fact made by the appeals referee and concluded that the workers at issue are the plaintiff's [320 Conn. 614] employees under the test set forth in the Connecticut Unemployment Compensation Act (act), General Statutes § 31-222 et seq. On appeal, the plaintiff claims that the trial court applied the wrong legal standard in reviewing its motion to correct. The plaintiff also claims that the trial court improperly concluded that the workers were the plaintiff's employees under § 31-222 (a) (1) (B) (ii) because they were subject to the plaintiff's control and direction in the performance of their services and they performed their services at the plaintiff's places of business. The defendant, the Unemployment Compensation Act Administrator, responds that the trial court applied the proper legal standard in reviewing the plaintiff's motion to correct and properly concluded that the workers were the plaintiff's employees under the test set forth in the act. We reverse the judgment of the trial court.

         The following relevant facts and procedural history are set forth in the trial court's memorandum of decision. " The plaintiff . . . [is in the business of selling and delivering home heating oil and also] provides home heating and alarm systems to residential customers. In doing so, it utilizes the services of certain individuals who [clean, service and install] heating/air conditioning systems or who [install] security systems (installers/technicians). In June of 2008, the . . . Department of Labor conducted an audit of the plaintiff. Following the audit, the [defendant] determined that the installers/technicians were misclassified as independent contractors rather than as employees. The [defendant] further concluded that, due to this misclassification, the plaintiff owed $41,501.38 in unemployment contribution taxes, plus interest, for 2007 and 2008.

         " The plaintiff appealed [from] the [defendant's] decision to the [appeals referee], who conducted an evidentiary hearing. Following this hearing, the appeals referee issued a decision with findings of fact, affirming [320 Conn. 615] the [defendant's] decision. The plaintiff then appealed to the [board]. The board modified the appeals referee's findings of fact and made additional findings in a decision on March 21, 2012. It determined that the plaintiff had met part C (General Statutes § 31-222 [a] [B] [ii] [III]) of the test set out in . . . § 31-222 (a) (1) (B) (ii) (the ABC test) for determining whether the installers/technicians were independent contractors, but also determined that the plaintiff had failed to demonstrate that the installers/technicians were independent contractors under part A (General Statutes § 31-222 [a] [B] [ii] [I]) and part B (General Statutes § 31-222 [a] [B] [ii] [II]). The plaintiff . . . appeal[ed] [to the trial court] on April 19, 2012, was granted an extension of time to file a motion to correct findings on May 18, 2012, and filed a motion to correct findings on August 30, 2012. The board issued a decision on the motion to correct findings on March 4, 2013, granting the motion in part and denying it in part. The board maintained its earlier decision as to the plaintiff's failure to meet parts A and B."

         The plaintiff filed claims of error and an appeal with the trial court. Following oral argument, the court dismissed the appeal on March 24, 2014. The court rejected the plaintiff's claim seeking to correct the board's factual findings and upheld the board's determination that the plaintiff had failed to satisfy parts A and B of the ABC test. This appeal followed.

         Section 31-222 (a) (1) (B) (ii) defines " employment" in relevant part as any service performed by " any individual who, under either common law rules applicable in determining the employer-employee relationship or under the provisions of this subsection, has the status of an employee. Service performed by an individual shall be deemed to be employment subject to this chapter irrespective of whether the common law relationship of master and servant exists, unless and until it is [320 Conn. 616] shown to the satisfaction of the administrator that (I) such individual has been and will continue to be free from control and direction in connection with the performance of such service, both under his contract for the performance of service and in fact; and (II) such service is performed either outside the usual course of the business for which the service is performed or is performed outside of all the places of business of the enterprise for which the service is performed; and (III) such individual is customarily engaged in an independently established trade, occupation, profession or business of the same nature as that involved in the service performed . . . ." Because the provision is in the conjunctive, the party claiming the exception to the rule that the service is employment must show that all three prongs of the test have been satisfied. E.g., JSF Promotions, Inc. v. Administrator, Unemployment Compensation Act, 265 Conn. 413, 419, 828 A.2d 609 (2003).

          " [W]hen interpreting provisions of the act, we take as our starting point the fact that the act is remedial and, consequently, should be liberally construed in favor of its beneficiaries. . . . Indeed, the legislature underscored its intent by expressly mandating that the act shall be construed, interpreted and administered in such manner as to presume coverage, eligibility and nondisqualification in doubtful cases. General Statutes § 31-274 (c)." (Internal quotation marks omitted.) Tuxis Ohr's Fuel, Inc. v. Administrator, Unemployment Compensation Act, 309 Conn. 412, 423, 72 A.3d 13 (2013). We also note that " exemptions to statutes are to be strictly construed." Daw's Critical Care Registry, Inc. v. Dept. of Labor, 42 Conn.Supp. 376, 389, 622 A.2d 622 (1992), aff'd, 225 Conn. 99, 622 A.2d 518 (1993). Nevertheless, the act " should not be construed unrealistically in order to distort its purpose." F.A.S. International, Inc. v. Reilly, 179 Conn. 507, 516, 427 A.2d 392 (1980). " While it may be difficult for a situation to exist [320 Conn. 617] where an employer sustains his burden of proof under the ABC test . . . it is important to consider that [t]he exemption [under the act] becomes meaningless if it does not exempt anything from the statutory provisions . . . where the law and the facts merit the exemption in a given case." (Citation omitted; internal quotation marks omitted.) Daw's Critical Care Registry, Inc. v. Dept. of Labor, supra, 389-90. Rather, " statutes are to be construed so that they carry out the intent of the legislature. . . . We must construe the act as we find it . . . ." (Citations omitted; internal quotation marks omitted.) Johnson v. Manson, 196 Conn. 309, 314-15, 493 A.2d 846 (1985), cert. denied, 474 U.S. 1063, 106 S.Ct. 813, 88 L.Ed.2d 787 (1986).

         Having conducted a comprehensive review of the board's modified findings of fact, we conclude that the trial court improperly determined that the installers/technicians were the plaintiff's employees under the first two prongs of the ABC test.[1]

         I

         We begin with the plaintiff's claim that the installers/technicians were free from its control and direction under part A of the ABC test. The plaintiff contends that the uncontroverted evidence establishes that the installers/technicians retained control and direction over the method and means of their work. The defendant responds that the installers/technicians performed their work subject to the plaintiff's control and direction. We agree with the plaintiff.

         The following additional facts are relevant to our resolution of this claim. Although the board modified [320 Conn. 618] its findings of fact[2] following a review of the plaintiff's [320 Conn. 619] motion to correct, it did not alter its earlier conclusion [320 Conn. 620] that the plaintiff had failed to satisfy part A of the ABC [320 Conn. 621] test. Thereafter, in upholding the board's conclusion, the trial court noted the board's findings that " the plaintiff advertises installed heating, cooling, and security systems; it makes appointments with customers, then finds an installer or technician who can take the assignment; it does not permit installers or technicians to subcontract; it encourages them to wear apparel bearing the plaintiff's name; it can send an installer or technician back to correct a deficient installation; it pays the installers or technicians a set rate per piece; and it requires them to submit payment invoices no later than the Friday after they complete the work. The board stated that five installers/technicians [indicated] that the plaintiff has the right to direct how they perform their work in a questionnaire. The board did not credit later statements by two of the installers/technicians that [320 Conn. 622] the plaintiff did not have [that] right. The board also stated that the installers can only install equipment provided by the plaintiff and that the technicians use nozzles, filters, and strainers which are provided by the plaintiff for cleaning oil burners. In addition, the board also initially listed the right to terminate without liability as a strong indication of an employer-employee relationship, but, in its decision on the plaintiff's motion to correct findings, removed this as a factor, amending finding [nineteen] to say that the parties stipulated that right to fire would not be a factor."

         The court further observed, however, that the board had acknowledged certain factors indicating that " the plaintiff did not exercise control and direction. These included that the installers/technicians signed independent contractor agreements stating they would exercise independence; that they were free to accept or reject assignments, [could] determine the days on which they [would] work, [were] not supervised while performing their work; that the plaintiff [did] not check on their work; that they [were] licensed and certified, that the plaintiff [did] not provide them with an employee handbook and [did] not pay them for training or require training; that the installers/technicians [could] hire employees to assist them and [were] free to supervise their employees; that the installers/technicians [could] realize a profit or a loss; and that they provide[d] their own tools, transportation, and insurance." The court nonetheless concluded that, although the plaintiff had made a " compelling case" that it lacked control and direction, the court was " not convinced that the board lack[ed] substantial evidence for its decision."

         We begin by setting forth the standard of review. It is well established that " [r]eview of an administrative agency decision requires a court to determine whether there is substantial evidence in the administrative record to support the agency's findings of basic fact [320 Conn. 623] and whether the conclusions drawn from those facts are reasonable. . . . Neither this court nor the trial court may retry the case or substitute its own judgment for that of the administrative agency on the weight of the evidence or questions of fact. . . . Our ultimate duty is to determine, in view of all of the evidence, whether the agency, in issuing its order, acted unreasonably, arbitrarily, illegally or in abuse of its discretion. . . . [A]n agency's factual and discretionary determinations are to be accorded considerable weight by the courts." (Citation omitted; internal quotation marks omitted.) JSF Promotions, Inc. v. Administrator, Unemployment Compensation Act, supra, 265 Conn. 417-18.

         With respect to the governing legal principles, we have stated that " [t]he fundamental distinction between an employee and an independent contractor depends upon the existence or nonexistence of the right to control the means and methods of work. . . . The test of the relationship is the right to control. It is not the fact of actual interference with the control, but the right to interfere, that makes the difference between an independent contractor and a servant or agent. . . . An employer-employee relationship does not depend upon the actual exercise of the right to control. The right to control is sufficient. . . . The decisive test is who has the right to direct what shall be done and when and how it shall be done? Who has the right of general control?" (Citations omitted; emphasis omitted; internal quotation marks omitted.) Latimer v. Administrator, Unemployment Compensation Act, 216 Conn. 237, 248, 579 A.2d 497 (1990). Under this test, we have stated that " [a]n independent contractor is one who, exercising an independent employment, contracts to do a piece of work according to his own methods and without being subject to the control of his or her employer, except as to the result of his work." (Internal quotation marks [320 Conn. 624] omitted.) Darling v. Burrone Bros., Inc., 162 Conn. 187, 195, 292 A.2d 912 (1972); accord Alexander v. R. A. Sherman's Sons Co., 86 Conn. 292, 297, 85 A. 514 (1912). The plaintiff bears the burden of showing that the workers hired as independent contractors " [have] been and will continue to be free from control and direction in connection with the performance of . . . service[s], both under [their] contract for the performance of service[s] and in fact . . . ." (Internal quotation marks omitted.) JSF Promotions, Inc. v. Administrator, Unemployment Compensation Act, supra, 265 Conn. 418.

          Part A of the ABC test provides that " [s]ervice performed by an individual shall be deemed to be employment . . . unless and until it is shown to the satisfaction of the administrator that . . . such individual has been and will continue to be free from control and direction in connection with the performance of such service, both under his contract for the performance of service and in fact . . . ." General Statutes § 31-222 (a) (1) (B) (ii) (I). Although the meaning of this language may seem clear, past agency interpretations of part A have been highly fact specific and not uniformly upheld on appeal to the Superior Court. See JSF Promotions, Inc. v. Administrator, Unemployment Compensation Act, Superior Court, judicial district of Hartford, Docket No. CV-97-0575801, (April 2, 2002) (reversing board's decision that product demonstrators hired to work at supermarkets were under plaintiff's control and direction), rev'd, 265 Conn. 413, 828 A.2d 609 (2003); Daw's Critical Care Registry, Inc. v. Dept. of Labor, supra, 42 Conn.Supp. 384-85, 412 (reversing board's decision that nurses hired to work at health-care facilities and hospitals on as needed basis were under plaintiff's control and direction). Accordingly, we seek guidance from several appellate decisions in which this [320 Conn. 625] court and the Superior Court[3] discussed the conditions necessary to satisfy part A of the ABC test.

         We initially addressed the issue of control and direction in F.A.S. International, Inc. v. Reilly, supra, 179 Conn. 507. In that case, we concluded that the trial court properly had sustained the plaintiff's appeal from the administrator's determination that the professional artists, writers and photographers employed in the plaintiff's correspondence schools to analyze and critique students' lessons were employees of the plaintiff rather than independent contractors. See id., 513, 516. We explained that the professionals " employed different techniques or approaches in their criticism and analysis of student work. The plaintiff's only concern was with the result or end product of their efforts. [The plaintiff] exercised no control over the means and method of their performance. Although it is true, as claimed by the administrator, that [the plaintiff] would not permit its professionals to hire others to evaluate student work which had been given to them for review, this prohibition is not significant because contracts for personal services cannot be assigned without consent. . . . It is obvious that [the plaintiff] depended upon the skill and reputation of the artists, writers and photographers it selected to produce a product of quality. The [plaintiff] did not rely on rote correction of objective examinations." [4] (Citation omitted.) Id., 513.

          [320 Conn. 626] We next considered the issue of control and direction in Latimer. See Latimer v. Administrator, Unemployment Compensation Act, supra, 216 Conn. 247-49. Unlike in F.A.S. International, Inc., we concluded in Latimer that the trial court properly had sustained the administrator's determination that several personal care aides placed in the plaintiff's home by the Litchfield Hills Nurses Registry (registry) were the plaintiff's employees rather than independent contractors, in part because the plaintiff had failed to show that the aides were free from the plaintiff's control and direction. Id., 243-44, 252. We specifically concluded that among the factors militating in favor of finding control and direction were that the plaintiff retained the right to discharge any aide without liability, although this factor was not considered conclusive, paid aides an hourly rate, established the hours when the aides were to work after the aides made known their hours of availability, directed the aides to perform personal errands and to be cognizant of instructions concerning the plaintiff's care, expected the services to be rendered personally by particular aides selected by the registry on the basis of the plaintiff's needs and instructions conveyed to the registry, and furnished the equipment and materials required for the aides to perform their work. See id., 249-50. We also noted that the aides did not realize a profit or suffer a loss based on the services they rendered. Id., 250. Even more important than the foregoing factors, however, was that the aides reported their daily activities to the plaintiff's attorney, to whom the plaintiff [320 Conn. 627] had granted a general power of attorney, and that the attorney personally monitored the level of care given to the plaintiff. Id. We explained that this finding embodied " the logical inference that the reporting and monitoring had a purpose and that, if the care given [to] the plaintiff [had been] unsatisfactory, [the attorney] could, and would, intervene and take corrective measures. That right of intervention . . . evinces a right to control and direct the [aides] by the recipient of their services." Id., 251. We added that " [t]he fact that the [aides] placed with the plaintiff by the registry signed an agreement that they were independent contractors [was] of no moment. Language in a contract that characterizes an individual as an independent contractor [rather than an employee] is not controlling. The primary concern is what is done under the contract and not what it says. . . . Such provisions in a contract are not effective to keep an employer outside the purview of the act when the established facts bring [the employer] within it. We look beyond the plain language of the contract to the actual status in which the parties are placed." (Citations omitted; internal quotation marks omitted.) Id., 251-52.

         Shortly thereafter, in Stone Hill Remodeling v. Administrator, Unemployment Compensation Act, Superior Court, judicial district of Waterbury, Docket No. 089398 (February 21, 1991) [3 Conn.L.Rptr. 829], the Superior Court cited Latimer in concluding that the administrator reasonably could have found that a worker who performed plumbing, electrical, carpentry and siding work at a construction site for the plaintiff, who was a home improvement contractor, was under the plaintiff's general control and direction, at least with respect to the carpentry work that he had performed for the plaintiff. Id., 830. The court cited the board's findings that the worker " at times work[ed] side by side with the [plaintiff on the carpentry work]. The [plaintiff] furnished the worker with tools and materials, indicating [320 Conn. 628] an element of control . . . . The carpentry work performed by the [worker] was under the supervision of the [plaintiff]." Id., 829, The plaintiff thus failed to sustain its burden of demonstrating that the worker was free from its control and direction. See id., 830.

          Stone Hill Remodeling was followed by Daw's Critical Care Registry, Inc. v. Dept. of Labor, supra, 42 Conn.Supp. 376, whose reasoning we adopted one year later in upholding that decision. See Daw's Critical Care Registry, Inc. v. Dept. of Labor, supra, 225 Conn. 102 (" we adopt the trial court's well reasoned decision as a statement of the facts and the applicable law on [the] issue [of the employer-employee relationship under the ABC test]" ). In Daw's Critical Care Registry, Inc., the Superior Court relied heavily on the factors discussed in Latimer in reversing the decision of the Employment Security Division of the Department of Labor that nurses hired by the plaintiff to work at health-care facilities and hospitals on an as needed basis and at an hourly rate were the plaintiff's employees under the first prong of the ABC test. Daw's Critical Care Registry, Inc. v. Dept. of Labor, supra, 42 Conn.Supp. 378, 384-85, 393-400. In concluding that the nurses in that case were not under the plaintiff's control and direction, the court relied on almost all of the factors we identified in Latimer. See id., 393-400. The court noted that, although the plaintiff retained the right to terminate an assignment without liability, other factors, including a lack of control and direction over the means and methods of the nurses' work at the medical facilities, meaning the right to direct what should be done and when and how it should be done, were more important. Id., 393-94. The court stated that " [the plaintiff's] function, after satisfying itself that a nurse was competent, was fairly limited to arranging times mutually convenient for the nurse and the particular medical facility where the nurse's services were to be rendered and examining a [320 Conn. 629] nurse's pay invoices when submitted to it for payment and in making payment. . . . Once the assignment to a particular medical facility was offered by [the plaintiff] and undertaken by . . . [the] nurse, the nurse went there and, subject to the protocol of that facility, rendered her professional services under that facility's direction. The . . . nurses could trade shifts after an assignment at a medical facility that [the plaintiff] serviced. This was done without the nurse being required to report such shift trades to [the plaintiff] . . . ." (Citation omitted; footnote omitted; internal quotation marks omitted.) Id., 394-95. Furthermore, unlike in Latimer, the plaintiff did not establish the hours when the nurses were to work and did not furnish the tools, equipment or materials necessary to do their job. See id., 395. In addition, the plaintiff did not send a representative to visit the medical facility to check on the nurses' work, did not conduct orientations for the nurses and did not issue the nurses a manual of instructions. Id., 396. Also weighing in favor of the plaintiff were that the name tags the nurses were required to wear in some facilities were not required by the plaintiff but by the facilities in which they worked. Id., 397.

         The court acknowledged that other factors tended to indicate control and direction, including that the nurses submitted payment invoices to the plaintiff indicating the time and location of their work, the invoices were on forms provided by the plaintiff, the times indicated on the invoice forms needed to be certified by the facility before being processed by the plaintiff, and the nurses were paid at an hourly rate. Id. The court determined, however, that the manner of remuneration was " 'not decisive or controlling'" because of the " reality" that the plaintiff " served in the nature of [a] conduit for payment." Id., 398. The court finally observed, citing Latimer, that the characterization of the nurses in their employment agreement with the plaintiff as independent [320 Conn. 630] contractors who were not subject to the plaintiff's control and direction was " entitled to some consideration . . . ." Id., 399.

         This court again considered the issue of control and direction in Tianti v. William Raveis Real Estate, Inc., 231 Conn. 690, 651 A.2d 1286 (1995). Although the plaintiff in Tianti brought the action pursuant to General Statutes § 31-72[5] on behalf of two real estate salespersons seeking to collect unpaid wages from the defendant, and not in the context of unemployment compensation; see id., 691-92; we stated that the ABC test was applicable in determining the existence of an employment relationship between the salespersons and the defendant. Id., 697. We then concluded that the defendant had the right to control its salespersons on the basis of findings that they " were required to attend mandatory office meetings . . . did business under the defendant's name . . . used the company letterhead, business cards and supplies . . . were required to attend training sessions . . . and . . . were threatened with discharge if they did not comply with these requirements. The right to terminate [an employment] relationship without liability is not consistent with the concept of an independent contract. . . . [One of the salespersons also] was required to put in specified hours of floor time and [the other salesperson] was required to work forty hours per week plus put in an office appearance on weekends." (Citation omitted; internal quotation marks omitted.) Id., 698; see also AAD Vantage of South Central Connecticut, Inc. v. Administrator, Unemployment Compensation Act, Superior Court, [320 Conn. 631]  judicial district of New Haven, Docket No. CV-96-0382334, (September 16, 1998) (plaintiff exercised right to control salespersons because it provided them with equipment or materials necessary to perform job, including business cards, order forms, desk space and telephone service, plaintiff provided training prior to assigning territory to salespersons, plaintiff conducted sales meetings and provided salespersons with customer lists, plaintiff's income was dependent on salespersons securing sales, commissions were set by plaintiff according to fee structure it established, commissions were not paid until salespersons' clients paid plaintiff, salespersons could not bind plaintiff in contract or agreement without plaintiff's approval, salespersons were required to utilize plaintiff's order forms and submit forms to plaintiff, salespersons were not authorized to collect money from clients they secured, and, most important, plaintiff retained right to terminate salesperson who did not use best efforts to secure customers and could establish criteria to determine what constituted salesperson's best efforts).

         The Superior Court addressed the issue more recently in JSF Promotions, Inc. v. Administrator, Unemployment Compensation Act, supra, Superior Court, Docket No. CV-97-0575801. In reversing the board's decision and concluding that product demonstrators hired to work at supermarkets were not the plaintiff's employees, the court cited Daw's Critical Care Registry, Inc., for the proposition that, because the plaintiff had served " as a mere conduit of information to enable the demonstrator to know what service to provide, what products were to be demonstrated, what equipment the demonstrator had to supply, where and what time the demonstrations were to be performed . . . [e]ven 'quality control' of the demonstrations was out of the plaintiff's hands--in that regard, it took its orders from the supermarket, which would make the judgment whether a [320 Conn. 632] particular demonstrator's work was satisfactory or not." Id. The court also observed that the demonstrator's contract allowed the demonstrator to assign work to be performed to other qualified demonstrators with notice to the plaintiff, which plainly meant that " the plaintiff [did] not even retain control over who [would] perform the demonstration service on any given job." (Emphasis in original.) Id.

         Applying the foregoing principles, we conclude that the board's modified findings of fact did not reasonably support its conclusion that the plaintiff in the present case had the right to control the means and methods of the work performed by the installers/technicians during the years in question.[6] The plaintiff did not own or operate the tools, machinery or heavy duty vehicles required for the installation of heating systems, tank removal or home alarm installation. It thus contracted with the installers/technicians, who were licensed and certified to perform their services in accordance with state law and who routinely performed such work for their own businesses or through self-employment. The contracts between the plaintiff and the installers/technicians provided that the installers/technicians shall exercise independent judgment and control in the execution of any work they conduct for the plaintiff. See Daw's Critical Care Registry, Inc. v. Dept. of Labor, supra, 42 Conn.Supp. 399 (plaintiff's characterization of nurses in employment agreement between them as not subject to plaintiff's control and direction was " entitled to some consideration," although not controlling). Consistent with this contract provision, the plaintiff did not supervise the installers/technicians and did not inspect their work. In fact, there was no representative of the plaintiff [320 Conn. 633] on a customer's premises at any time during an installation project, either while it was in progress or upon its completion. The same was true for the technicians. See id., 394-96 (rendering of nurses' services under facilities' direction and plaintiff's practice of not sending representative to check on nurses' work indicated absence of control and direction); cf. Latimer v. Administrator, Unemployment Compensation Act, supra, 216 Conn. 250-51 (reporting by personal care assistants of daily activities to plaintiff's attorney, who personally monitored level of care given to plaintiff, indicated control and direction).

         In addition, the installers/technicians were free to accept or reject any assignment offered to them without adverse consequences. Although an assignment, once accepted, had to be performed within a designated timeframe set by the plaintiff and the customer, the installers/technicians chose the days on which it was convenient for them to work. See Daw's Critical Care Registry, Inc. v. Dept. of Labor, supra, 42 Conn.Supp. 394-95 (arranging times mutually convenient for nurses and medical facilities instead of establishing hours when nurses must work indicated absence of control and direction); cf. Tianti v. William Raveis Real Estate, Inc., supra, 231 Conn. 698 (requiring salespersons to work specified hours indicated control and direction); Latimer v. Administrator, Unemployment Compensation Act, supra, 216 Conn. 250 (establishing hours when personal care assistants must work after they made hours of availability known to plaintiff indicated control and direction). Each of the installers/technicians also had an independent business that provided the same type of services that they provided for the plaintiff. As a consequence, many installers/technicians had their own business cards, advertised their businesses and earned an undetermined amount of their income from sources other than the plaintiff.

          [320 Conn. 634] Furthermore, after an assignment was accepted, the installers/technicians used their own equipment and tools to complete each project. See Daw's Critical Care Registry, Inc. v. Dept. of Labor, supra, 42 Conn.Supp. 395 (failing to furnish tools, equipment or materials necessary for nurses to perform their work indicated absence of control and direction); cf. Tianti v. William Raveis Real Estate, Inc., supra, 231 Conn. 698 (furnishing equipment or materials to perform work indicated control and direction); Latimer v. Administrator, Unemployment Compensation Act, supra, 216 Conn. 250 (same). Although the installers/technicians were required to provide their services personally and were not permitted to subcontract or hire casual, pickup or day laborers, they could hire assistants to help them perform their work and could supervise the assistants as they saw fit. See Daw's Critical Care Registry, Inc. v. Dept. of Labor, supra, 42 Conn.Supp. 394-95 (nurses' practice of trading shifts following assignment to facility without being required to report trades to plaintiff indicated absence of control and direction). Complaints regarding installation or other technical services and problems that arose during the warranty period originated with the customers and were referred to the plaintiff, who served as a conduit in reporting them to the installers/technicians and arranged for repairs or for payments by the installers/technicians to cover the cost of repairs by others. Cf. Latimer v. Administrator, Unemployment Compensation Act, supra, 250-51 (direct monitoring by plaintiff's attorney of care given to plaintiff indicated control and direction).

         On matters of training and attire, the plaintiff did not provide the installers/technicians with an employee handbook and did not pay for their training or require any specific training relating to its products. Installers were encouraged, but not required, to display the plaintiff's name on their clothing and utility vehicles. Security [320 Conn. 635] system installers were required to display photographic identification badges that described them as subcontractors, not as the plaintiff's employees. The plaintiff provided the installers/technicians with shirts and hats labeled " Standard Oil," but only because wearing these items might alleviate customer concern or confusion when the installers/technicians appeared at a customer's residence. Wearing the clothing was not required. See Daw's Critical Care Registry, Inc. v. Dept. of Labor, supra, 42 Conn.Supp. 396-97 (failing to conduct orientation for nurses or to require name tags while nurses worked at facilities indicated absence of control and direction); cf. Tianti v. William Raveis Real Estate, Inc., supra, 231 Conn. 698 (requiring salespersons to attend training sessions and to use company letterhead and business cards indicated control and direction).

         The installers/technicians received compensation on the basis of a set rate per piece of work, rather than an hourly rate, could realize a profit or loss from the services rendered, and paid for their own transportation without reimbursement by the plaintiff. Cf. Latimer v. Administrator, Unemployment Compensation Act, supra, 216 Conn. 250 (paying personal care assistants hourly rate and fact that they did not realize profit or suffer loss based on services indicated control and direction).

         Although the installers/technicians remitted invoices to the plaintiff, we do not agree with the court in Daw's Critical Care Registry, Inc., that this is indicative of control and direction. It is independent contractors, rather than employees, who typically submit invoices for their work. Neither the legal nor the ordinary definition of the term suggests that an employee is paid on the basis of an invoice. See Black's Law Dictionary (10th Ed. 2014) p. 956 (defining " invoice" as " [a]n itemized list of goods or services furnished by a seller to a buyer, usu[ally] specifying the price and terms of sale; a bill of [320 Conn. 636] costs" ); Webster's Third New International Dictionary (2002) p. 1190 (" an itemized statement furnished to a purchaser by a seller and usu[ally] specifying the price of goods or services and the terms of sale" ). Moreover, references in Connecticut case law to the payment of invoices consistently appear in connection with payments made to contractors rather than to employees. See, e.g., Campisano v. Nardi, 212 Conn. 282, 286, 562 A.2d 1 (1989) (referring to money applied to payment of subcontractors based on invoices submitted and shown to plaintiffs); Ray Weiner, LLC v. Connery, 146 Conn.App. 1, 4, 75 A.3d 771 (2013) (referring to " invoices and moneys charged by subcontractors" ); D'Angelo ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.