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Unemployment Insurance - Worker Classification

Part 2: Six of Nine Conditions - General Private Employers

Condition Six - Services Do Not Directly Relate (Case Studies)

The services performed by the individual do not directly relate to the employing unit retaining the services.

Note: This condition in the new law is one of the factors used in the current law applicable to government units and nonprofit organizations. Therefore, cases under the new law are listed first, followed by cases under the law applicable to government units and nonprofit organizations that also address this condition.

Case Studies Relevant to Condition Six

LIRC decisions

Services performed do not directly relate to the employing unit retaining the services:

  • Salvi v. Cullen, Weston, Pines & Bach, LLP, UI Dec. Hearing No. 12004296MD (Mar. 12, 2013) – Frank Salvi performed services as a physician, reviewing medical records and preparing a medical report, for Cullen, Weston, Pines & Bach, LLP, a law firm. He performed medical services for the law firm, not legal services. Although these services assisted the law firm in representing its client, such services are not directly related to the business of the law firm.

Services performed directly relate to the employing unit retaining the services:

  • Ali v. Acute Care, Inc., UI Dec. Hearing No. 13600624MW (LIRC Aug. 7, 2013) - Zulfiqar Ali performed services as an emergency room physician for Acute Care, Inc., a business that contracted with hospitals to staff their emergency rooms. As a physician, he performed services that were integrated into the business of Acute Care, a staffing service for medical facilities that matches physicians with the facilities. His medical services are directly related to the specific business of Acute Care. Note: This case includes analyses under both the old law and the new law.

  • Martin v. Madison Newspapers, Inc., UI Dec. Hearing No. 13001922MD (LIRC Oct. 10, 2013) - Julie Martin performed services as a writer for Agri-View, a newspaper published by Madison Newspapers, Inc. As such, she performed services directly related to, and integrated into, Madison Newspaper's weekly agricultural publication, Agri-View.

  • Koeser v. Pinnacle Health & Fitness, Inc., UI Dec. Hearing No. 12002891MD (LIRC Nov. 16, 2012) – Matthew Koeser performed services as a massage therapist for Pinnacle Health & Fitness, Inc., a health club. His massage therapy services were related to health and fitness and, as Pinnacle's name describes, such services are directly related to Pinnacle's business.

LIRC cases decided under the law applicable to government units or nonprofit organizations:

  • Williams v. MTEC, UI Dec. Hearing No. 07604021MW (LIRC Nov. 21, 2007) - The Milwaukee Teacher Education Center (MTEC), a nonprofit organization, offered a master's degree program in urban education, and selected Katie Williams to be an instructor of one of its core courses. Although LIRC concluded that she performed services for MTEC as an independent contractor, LIRC determined that her services were integrated into MTEC's business. MTEC developed and implemented instructional programs, and Williams instructed a course within one of those programs. This condition was not met.

  • Lopez v. County of Richland, UI Dec. Hearing No. 09003995MD (LIRC Jan. 15, 2010) - Daniel Lopez performed services as a Spanish interpreter for the Richland County government during out-of-court interactions between the sheriff's department and private individuals. The services provided by Lopez were integrated into the law enforcement activities of Richland County. This condition was not met.

  • Ristau v. Fox Valley Symphony Orchestra Ass'n, UI Dec. Hearing No. 06401057AP (LIRC Aug. 23, 2006) - Paul Ristau worked under annual contract for the Fox Valley Symphony Orchestra (FVSO) as principal tympanist. LIRC found that Ristau's services were integrated into FVSO's business. The services of a musician are directly related to the operation of an orchestra. This condition was not met.

Significant case decided under older unemployment insurance law in Wisconsin governing "employee" or "independent contractor" status

  • Moorman Mfg. Co. v. Indus. Comm'n, 241 Wis. 200, 5 N.W.2d 743 (1942) - Elliot was a salesman hired by Moorman Manufacturing to sell its stock feed under contract in a specified territory. The Wisconsin Supreme Court ruled that Elliot provided his services as an employee and not an independent contractor. The court held that Elliot was not engaged in an independent trade or business. Elliot's services were integrated into Moorman's business. The court used the example of a tinsmith to illustrate integration. A company hired a tinsmith to repair its gutters, and the company was engaged in a business unrelated to either repair or manufacture of gutters. Because the tinsmith's activities were totally unrelated to the business activity conducted by the company retaining his services, the services performed by the tinsmith did not directly relate to the activities conducted by the company retaining those services and the services were, therefore, not integrated into the company's business.

Further Reading and Research

Read and research further LIRC, circuit court and court of appeals cases on Condition Six:

  • EE 450.02f - Employee - s. 108.02(12)(bm)2.f. - relation of services to that of retaining employing unit.

Relevant cases under the old law:

  • EE 411 -s. 108.02(12)(c) direction and control/independently established tests, generally;
  • EE 413 - Employee - s.108.02(12)(c)2. - "independently established"