State ex rel. Employment Security Commission v. Paris

COZORT, Judge. In this case the trial court held that a private nurse’s assistant was an independent contractor and affirmed the denial of unemployment compensation benefits. We affirm. Thelma Paris, claimant or appellant herein, is a nurse’s assistant. From November 1986 until February 1988, she worked as a nurse’s assistant to Mary Emmerson. Claimant negotiated the terms of her employment with Mrs. Emmerson’s son. Claimant performed various services for Mrs. Emmerson, including bathing, personal grooming, administering medicine, dressing a surgical wound and some housekeeping. Claimant was relieved of her duties in February 1988 when Mrs. Emmerson and her husband required more skilled care than claimant was able to provide. On 6 March 1988, Paris filed a claim with the Employment Security Commission [hereinafter ESC] for unemployment compensation. She was denied benefits on the grounds that she was not an employee of the Emmersons but an independent contractor. Claimant appealed. Deputy Commissioner T. S. Whitaker rendered an opinion on 14 March 1989 which affirmed the determination that Paris was an independent contractor and not an employee. Claimant appealed to Orange County Superior Court. Judge Gordon Battle affirmed the decision of the ESC. Claimant appeals to this Court. Claimant assigns as error the court’s entry of judgment affirming the final decision of the ESC finding that the claimant was an independent contractor and not an employee. The Deputy Commissioner found: 7. When Paris began this relationship with the Emmersons, she was interviewed by Fred B. Emmerson, Jr. She wanted to be paid without Social Security or taxes withheld. She understood that she would have to pay her own taxes and would have no benefits such as vacation, insurance, etc. She was responsible for arranging for other care givers to be there and was responsible for arranging for a replacement when she could not be there. She has, on occasion, submitted a time sheet and paid the replacement out of the money that she received. 8. This employment relationship began with the expressed understanding that Paris was an independent contractor and [471] not an employee. She acted in a supervisory type capacity for the other individuals who worked for the Emmersons. Mary Emmerson is unable to talk and both Fred B. Emmerson and Mary Emmerson require a great deal of help. Thelma Paris was replaced by a licensed practical nurse because an individual with more extensive training in health care was needed. 9. Fred Emmerson, Jr., retained the right to discharge or separate Thelma Paris for gross negligence and to insure that she properly cared for his parents. He did not retain the right nor did he supervise and control the daily activities of the claimant. For the reasons we set forth below, we hold that the trial court did not err by affirming the findings and decision of the ESC. Unemployment insurance benefits are not available to those who are not employees within the meaning of the unemployment insurance statute. N.C. Gen. Stat. § 96-8(6) defines employment as service performed ... for wage or under any contract of hire, written or oral, express or implied, in which the relationship of the individual performing such service and the employing unit for which such service is rendered is, as to such service, the legal relationship of employer and employee. Provided, however, the term “employee” . . . does not include (i) any individual who, under the usual common-law rules applicable in determining the employer-employee relationship, has the status of an independent contractor or (ii) any individual (except an officer of a corporation) who is not an employee under such common-law rules. In Hayes v. Elon College, 224 N.C. 11, 29 S.E.2d 137 (1944), the Supreme Court set forth the primary criteria to be considered in determining whether an individual is an employee or an independent contractor. While the court held that no one particular criteria must be present, the court held that an independent contractor: (a) is engaged in an independent business, calling, or occupation; (b) is to have the independent use of his special skill, knowledge, or training in the execution of the work; (c) is doing a specified piece of work at a fixed price or for a lump sum or upon a quantitative basis; (d) is not subject to discharge because he adopts one method of doing the work rather than [472] another; (e) is not in the regular employ of the other contracting party; (f) is free to use such assistants as he may think proper; (g) has full control over such assistants; and (h) selects his own time. Id. at 16, 29 S.E.2d at 140. In the case below, the Deputy Commissioner found that This case is one that does not easily lend itself to a decision. Certain criteria would indicate that this claimant was an employee and others would indicate that she was independent contractor. The undersigned reaches the result that is reached because he believes that the parties clearly intended for this to be a relationship of employer/independent contractor and not employer/employee. We hold that this conclusion is proper. The record on appeal reveals facts indicative of an employer and employee relationship as well as those of an employer and independent contractor relationship. While we recognize that the parties’ intent may not always be so readily apparent as to be a criteria for the determination of whether an individual is an independent contractor, we find that in the case at bar it is helpful to consider the intent of the. parties. We find merit to Emmerson’s argument that her son, who negotiated the hiring of Paris, and Paris intended the relationship to be one of employer and independent contractor. There is evidence in the record to show that at the time of contracting Paris knew that she would not be able to receive unemployment insurance benefits. There is testimony that the parties orally agreed that Paris would serve as an independent contractor. Emmerson’s son testified that he and claimant expressly discussed the differences between being an independent contractor and the consequences which follow being an independent contractor. At the hearing before the Deputy Commissioner, Paris testified that she knew that she would not have any benefits as the job was set up. She recognized that she would make her money from the salaries and that she would save her money so that she would have her own benefits when she needed a “vacation or whatever.” Further, claimant testified that “when the job came to an end for me, I said, well, I don’t have any benefits, I know [s«'c] that I wouldn’t.” We find that it would be inconsistent with her agreement with Emmerson for [473] claimant to have reaped the benefits of a higher salary without deductions and now receive unemployment insurance benefits. From the evidence in the record, it is apparent that the parties did not intend for claimant to receive the agreed upon salary free from deductions and also be eligible for unemployment compensation benefits. Considering both the intention of the parties and the Hayes factors present in this case, we hold that claimant was hired as an independent contractor. Thus, we affirm the superior court’s order affirming the ESC’s denial of unemployment insurance benefits. Affirmed. Judge WELLS concurs in result. Judge JOHNSON dissents.