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Part 2: Six of Nine Conditions - General Private Employers
Condition Three - Multiple Contracts (Case Studies)
The individual operates under multiple contracts with one or more employing units to perform specific services.
Note: This condition incorporates the first part of condition 4 of the old law, requiring "multiple contracts." Cases under the new law are listed first, followed by cases under the old law that address the "multiple contracts" element of the condition.
Case Studies Relevant to Condition Three
- Ziburski v. Castforce Inc., UI Dec. Hearing No. 13202144EC (LIRC Nov. 22, 2013) – Patricia Ziburski, a merchandiser, performed merchandising services for Castforce, Inc., a retail merchandising business. She performed similar services for 27 other business entities, for only three of which she worked as an acknowledged employee. Given these circumstances, this condition is met.
- 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 similar services for another law firm and for various patients, satisfying this condition.
- Elie v. City Business USA LLC, UI Dec. Hearing No. 11608771MW (LIRC Mar. 28, 2012) - Tannette Elie performed services as a journalist for City Business USA LLC, a business journal. She and City Business USA LLC negotiated at arm's length an agreement for each writing assignment. NOTE: This case includes analyses of employment status under both the old law and the new law.
- Owen Jensen, UI Dec. Hearing No. 11401161AP (LIRC Aug. 19, 2011) – Owen Jensen wrote scripts and narrated instructional videos for an Illinois business that produced instructional video presentations involving insurance products. He negotiated a second agreement with the Illinois business, and had an agreement with a different business to perform similar services. NOTE: This case includes analyses of employment status under both the old law and the new law.
No multiple contracts:
- 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. Although she worked for a marketing agency at the same time she performed services for Madison Newspapers, that marketing work was as an employee. LIRC has never accepted the proposition that employment as an employee with another business would constitute a contract satisfying this condition.
- 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. He had only one contract with Acute Care, not a series of arm's length agreements for various shifts. NOTE: This case includes analyses of employment status under both the old law and the new law.
- 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. Although there was evidence that he performed massage therapy services for another entity, there was no evidence to support a finding that he did so as an independent contractor, a requirement for a finding of multiple contracts under this condition.
- Cortez-Robles v. Pro-One Janitorial Inc., UI Dec. Hearing No. 11403642AP (LIRC May 3, 2012) – Samuel Cortez-Robles signed a franchise agreement with Pro-One Janitorial Inc., to perform cleaning and janitorial services. He had only contract with Pro-One, which submitted bids to customers, including the contract price, and he could either accept or decline each customer. There was no evidence in the record that Cortez-Robles had an opportunity to negotiate at arm's length the terms of each account he serviced.
- Bentheimer v. Bankers Life & Casualty Company, UI Dec. Hearing No. 10006546JV (LIRC Aug. 16, 2011) – Kathleen Bentheimer performed services as an insurance sales person for Bankers Life & Casualty Company, an insurance company. Although she signed two agreements with Bankers Life, the terms were dictated by Bankers Life, not negotiated at arm's length, and contained the terms of a single ongoing working relationship. NOTE: This case includes analyses of employment status under both the old law and the new law.
LIRC cases regarding "multiple contracts" under condition 4 of the old law:
- Nature’s Pathways LLC, UI Dec. Hearing No. S0800258AP (LIRC Feb. 5, 2010) – Worker performed similar editing services for other entities at an earlier time. The time period relevant to this condition is the time during which the worker has been performing the type of service at issue.
No multiple contracts:
- Gary R. Gilbert, UI Dec. Hearing No. S0200083DB (LIRC July 21, 2005), aff’d Gilbert v. LIRC, 2008 WI App 173, 315 Wis. 2d 726, 762 N.W.2d 671 – Construction workers performed services only for Gilbert, and there was no evidence indicating arm's length negotiations between workers and Gilbert for each construction job.
- Spencer Siding, Inc., UI Dec. Hearing Nos. S0300142GB, S0300133GB (LIRC June
2, 2006) – Spencer Siding, Inc. (Spencer), entered into oral contracts with 34
workers to perform roofing, siding, and framing services for various general
contractors. Spencer essentially functioned as an expediter for these general
contractors and, for his efforts, deducted 10-12.5 percent from the amount the
general contractors paid to Spencer for the roofing, siding, and framing
services provided by the workers.
The first part of condition 3 requires multiple contracts. These may take the form of multiple contracts with separate entities, or multiple serial contracts with the employer if the contracts are shown to have been negotiated "at arm's length," with terms that will vary over time and will vary depending on the specific services covered by the contract. The existence of legitimate multiple contracts tends to show that the worker either has multiple customers, or that he has periodic opportunities for "arm's length" negotiation with the employer as to the conditions of their relationship, and that he is not dependent upon a single, continuing relationship that is subject to conditions dictated by a single employing unit. There was no specific evidence as to the existence of contracts between any of the workers and entities other than Spencer. The contracts under which the workers performed services for Spencer were project-specific oral contracts in which Spencer essentially established a piecework rate for roofing, siding, and framing work based upon what the project's general contractor was willing to pay.
These contracts do not satisfy the requirement of having been negotiated at arm's length. The "bids" submitted to Spencer by the workers appear to have served no practical purpose, i.e., the actual piecework rate for a project was established by increasing or decreasing a worker's "bid" based upon the amount the general contractor was willing to pay for roofing, siding, or framing services for the project, not by arm's length negotiations between Spencer and the workers.
- Prince Cable Inc.,
UI Dec. Hearing No. S9900227MW (LIRC Feb. 23, 2001) -
Prince Cable, Inc., (Prince) hired cable installers as well as cable collectors
(of money and boxes) to perform cable installation work on behalf of its client,
Time Warner. Prince contended that the various cable installers and collectors
were independent contractors and not its statutory employees.
Prince argued that these workers signed agreements with Prince to do specific work for a specific amount of money and that these agreements were multiple serial contracts to perform specific services. The threshold requirement of multiple contracts can be satisfied either by proof of multiple serial contracts or multiple contemporaneous contracts. Multiple contracts that an individual enters into with multiple business entities are most indicative of that individual's economic independence from a particular employer. However, multiple serial or contemporaneous contracts with a particular employer may also satisfy the criterion if the contracts are shown to have been negotiated "at arm's length." LIRC noted that in genuine independent contractor relationships, negotiations would typically result in terms that would vary over time and vary depending on specific services covered by the contract.
Here, there was no proof that the workers had contracts for cable installation with other businesses or that the workers negotiated with Prince regarding fees. Prince informed the workers how much they would be paid per job by the type of tasks they performed at a customer's home. Consequently, there was no negotiation between Prince and the workers. While Prince argued that the day-to-day assignments by its dispatcher created multiple serial contracts or multiple contemporaneous contracts, this characterization fails to accurately describe the actual relationship between the workers and Prince.
- Dane Cnty Hockey Officials Ass'n, UI Dec. Hearing No. S9800101MD (LIRC Feb. 22, 2000) – This condition is not met because the officials did not negotiate and renegotiate pay rates with DCHOA, but accepted rates provided for matches to which they were assigned. There was a continuing relationship similar to employment in which the terms of the ongoing relationship did not vary over time.
Further Reading and Research
Read and research further LIRC, circuit court and court of appeals cases on Condition Three:
- EE 450.02c - Employee - s. 108.02(12)(bm)2.c. - multiple contracts.
Relevant cases under the old law:
- EE 410.04a - contracts for specific services for specific amounts