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Unemployment Insurance - Worker Classification
Truckers (Motor Carriers and Contract Operators)
Part 1 - Direction and Control
Wis. Admin. Code Chapter DWD 105 (Relationships of Carriers and Contract Operators) determines whether or not a trucker who is a contract operator for a licensed motor carrier is an employee for the purposes of unemployment insurance. (See Wis. Admin. Code § DWD 100.02 for definitions of "carrier" and "contract operator" and Wis. Stat. § 108.02 (25e) for the definition of "trucker".)
According to Wis. Admin. Code § DWD 105, an employer must examine the following eight factors to determine, both under contract and in fact, whether the trucker/contract operator is free from the motor carrier's direction and control:
- The contract operator owns the motor vehicle or holds the vehicle under a bona fide lease arrangement with any person other than the carrier.
- The contract operator is responsible for the maintenance of the motor vehicle.
- The contract operator bears the principal burden of the motor vehicle operating costs. Those costs include fuel, repairs, supplies, insurance and personal expenses while on the road.
- The contract operator supplies, or is responsible for supplying, the necessary personal services to operate the motor vehicle.
- The contract operator determines the details and means of performance. This includes the type of equipment, assignment of driver, loading, routes and number of stops to be made during the haul, as well as starting, completion and elapsed times.
- The contract operator may refuse to make a haul when requested by a carrier.
- The contract operator may terminate the lease at any time after reasonable notice.
- The contract operator is compensated on a division of the gross revenue or by a fee based upon the distance of the haul, the weight of the goods, the number of deliveries, or any combination of these factors.
If all eight of the factors above are present, the contract operator will be found by the department to be free from the employer's direction and control.
If one or more of the eight factors above are not present in the relationship between the carrier and contract operator, you must analyze the following six additional factors to determine, both under contract and in fact, whether:
- The contract operator may negotiate with the carrier to determine the method, frequency, and regularity of payments made to the contract operator.
- The contract operator has the authority to discharge any driver the contract operator employs.
- The carrier requires the employer's decals, emblems or other markings on the contract operator's motor vehicle for the purpose of advertising the employer's name or business.
- The carrier requires the contract operator to submit reports.
- The carrier requires the trucker/contract operator to obey any work rules or policies.
- The carrier requires any deductions from payments owing to the trucker/contract operator for federal or state income taxes or taxes under the Federal Insurance Contribution Act.
Under the law, the six factors are considered, but no one factor or particular combination of factors controls the determination of whether the contract operator is under the direction and control of the employer.
If the contract operator is not free of direction and control of the carrier, the contract operator is an employee for purposes of unemployment insurance.
If after applying the above test, the contract operator is found to be free from the employer's direction and control, the next question is whether the contract operator is "performing these services for the carrier in an independently established business in which the contract operator is customarily engaged".