I hired a contractor recently to do some work for me. He was already receiving unemployment compensation from another company. I had him fill out a w-9 for this and to be on the up and up he went to report the money he was making from my business to the UC department(PA). They turned off his UC and said they were going to contact me. I never received the letter but did get a phone call. Based on that phone call they sent a determination letter stating that " The claimant is not free from direction or control in the performance of his job. As such, the claimant is not self-employed and benefits are allowed under section 402(h) of the law. The notice does not state any money that will be granted to him but when I called them today they said that it was to be so and they did not have the figure. This contractor only worked for me for 5 weeks and made $995 within that time-frame. How should I appeal this? Am I really supposed to pay his UC ?
State/Country relating to question: Pennsylvania
I have tried calling them but they said I must file an appeal.
Thank you for your question. I am a Pennsylvania licensed professional and will do my best to assist you with your concerns. If you would like me to clarify my answer, I will be happy to do so.I am sorry to hear that you are in this situation? On what grounds is the UCC claiming that he was an employee rather than a contractor? Are they claiming scope of control? Who terminated his employment, you did or did he quit on his own?
Hello Dimitry, Thank you. They are stating scope of control I believe. They are saying that the claimant (contractor) is not free from direction or control in the performance of his job. The actual discussion reads as follows:"Section 402(h) of the Pennsylvania UC law provides, in part, that a self-employed Claimant is ineligible for benefits. Precedent court decisions have stated that the Claimant is to be considered self-employed where he is free from direction or control in the performance of the job and is customarily engaged in an independently established trade, occupation, profession or business. In this case, the Claimant was not free from direction or control in the performance of the job. As such, the Claimant is not self-employed and benefits are allowed under Section 402(h) of the law." The contractor agrees he was working as a contractor still and has already filled out w-9 for this. He did not file against my company but was simply reporting his earnings and it led to this determination. When i had the interview the UC rep was asking me questions when i was out of the office and I did not have TRUE answers for her but was giving her estimates (pay etc). I told her this and she was simply wanting to rush me through the interview. (which obviously turned out bad for me)As for as being let go or quitting he was never hired. He was only to be pulled in at various times for jobs. So it wasn't like he was fired or quit. The work wasn't there so then he doesn't continue. This is the agreement. I give him work "when i can" and not on a regular basis.
Additionally, i received three letter papers. One being a appeal form. and two forms that looked the same. In the box that says " the claimant has indicated the reason for separation or partial unemployment as " one say "correct emp add"the other says " lack of work"
Thank you for your follow-up, JosephThis is going to be a tough situation, and potentially an expensive one. You do have the right to appeal, and you have 15 days from the date of their ruling to contact unemployment either yourself or via counsel, and contest their findings. A commissioner will review and make a determination as to whether or not the person was considered an employee or an independent contractor. The reason I suggest an attorney is because employers are generally biased against by the commissioners (I say that as someone who represented on both sides in their meetings), and having an attorney there could likely streamline the process. Hope that helps.Dimitry Esquire41107.9797509259
Thank you for your follow-up, Joseph. For future reference pressing a “1” or a "2" provides me with a negative rating from the website and reflects poorly on my work. If you need a follow-up request, please press the "CONTINUE CONVERSATION" link and as I stated above, I will be happy to respond further.What specifically did I fail to address?
Dimitry you simply told me to "get an attorney". The fact is that I never received a financial determination prior to my written determination. Does this mean that I am not responsible and will not have to pay out? Also it was not within the base-year of the contractors pay. The Contractor also never paid in any money to UC during his time when working for me. A friend that consults for these types of cases just stopped by and provided this information. I do not wish to pay $58 for a reply of " get an attorney" . Furthermore, it states on the documents to reply within 15 days. This isn't a valued response.
Thank you for your follow-up, Joseph. I will respond to each concerns in order.Dimitry you simply told me to "get an attorney". Not true. I stated that the best approach would be for you to retain counsel because of the bias, but you can file the appeal yourself. By your own words you were unprepared for the communication with the agency and that ended up costing you because this individual became an 'employee' when he was simply an independent contractor.The fact is that I never received a financial determination prior to my written determination. Does this mean that I am not responsible and will not have to pay out? No, it does not mean that at all. Once he was found to be an employee, you become responsible for his Unemployment Benefits if they find that the reason he left employment was without cause. This is the other reason I suggested counsel.Also it was not within the base-year of the contractors pay. Correct, but as a subsequent employer, you can be made liable for his current unemployment benefits.The Contractor also never paid in any money to UC during his time when working for me. That is your responsibility as his 'employer', once you were found to be his employer by the agency, and why appealing that status is so important.A friend that consults for these types of cases just stopped by and provided this information. You are free to engage the opinions of whomever you wish, but the fact remains that once an IC was found to be an employee, that becomes your legal and financial responsibility.I do not wish to pay $58 for a reply of " get an attorney" . That is your choice, and you are free not to pay, but giving me personally a 'bad service' evaluation when I am trying to assist you is not fair or professional to me and to what I am trying to assist you with.Furthermore, it states on the documents to reply within 15 days. This isn't a valued response. I did not have that information in front of me, and I do not know what you know--I simply provided you with a deadline in case you were unaware. That information is something you did not tell me, I provided it to you based on my experience and research. Good luck and take care.Dimitry Esquire41108.0280502662
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