Detroit Medical Center Corp v Yff – 17.13

Detroit Medical Center Corp v Yff
Digest no. 17.13

Sections 42, 43(o)

Cite as: Detroit Medical Center Corp v Yff, Emmet Circuit Court, No. 97-4502-AE (June 18, 1998); lv den Mich App No. 213896 (December 30, 1998).

Appeal pending: No
Claimant: Michael Yff
Employer: Detroit Medical Center Corporation
Docket no.: L97-00001-2658
Date of decision: June 18, 1998

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CIRCUIT COURT HOLDING: Even though the primary function of the medical residency was to provide additional training, the claimant functioned as an employee. Furthermore, his services were not statutorily excluded.

FACTS: Claimant filed for unemployment benefits after completing his medical residency. He had worked for employer pursuant to a written contract for his services in exchange for compensation of $30,000+ per year with benefits. He was required by his contract to provide medical services to clients of employer at its facility.

DECISION: Claimant’s services are in covered employment under Section 42 and are not excluded under Section 43(o).

RATIONALE: Section 43(o)(5) does not apply to the claimant, claimant was not involved in an unemployment work-relief or work-training program financed by a governmental entity. Claimant worked under the express direction and control of the employer. Services provided by claimant fit the definition of employment in all pertinent respects.

Digest Author: Board of Review (original digest here)
Digest Updated:
7/99

Maguire v Charter Township of Shelby – 17.17

Maguire v Charter Township of Shelby
Digest no. 17.17

Sections 42, 43(o)(iii)(E)

Cite as: Maguire v Charter Twp of Shelby, Macomb Circuit Court, No. 95-1828-AE (February 28, 1996).

Appeal pending: No
Claimants: Joseph Maguire, Frances Gillett, Kirby Holmes
Employer: Charter Township of Shelby
Docket no.: L91-11605-2320
Date of decision: February 28, 1996

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CIRCUIT COURT HOLDING: Where claimants resigned from non-tenured policymaking/advisory positions to which they were elected and were then hired or appointed to tenured, non-policymaking, non-advisory positions, their services were not excluded even if they essentially continued the same type of work as before.

FACTS: Claimants were elected to positions as township clerk, supervisor and treasurer in November 1988. They all resigned in June 1989, and were appointed to subordinate positions within the township. They were all removed following the November 7, 1990, election. Employer argues the claimants should be denied benefits because of the Section 43(o)(iii)(E) exclusion of high level policymakers in that they were performing policymaking functions even after they left office for their appointed positions and could no longer vote at trustee meetings.

DECISION: The claimants’ employment was not statutorily excluded under Section 43(o)(iii)(E).

RATIONALE: Claimants no longer had ultimate policymaking authority after June 1989, even though they may have rendered great assistance to the policymakers who replaced them.

Digest Author: Board of Review (original digest here)
Digest Updated: Unknown

Psychological Services v MESC – 17.14

Psychological Services v MESC
Digest no. 17.14

Sections 42, 44

Cite as: Psychological Services v MESC, Kent Circuit Court, No. 89-64789-AE, (May 4, 1990).

Appeal pending: No
Claimant: N/A
Employer: Psychological Services
Docket no.: L87-07843-RO1-1978
Date of decision: May 4, 1990

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CIRCUIT COURT HOLDING: Where several licensed psychologists paid to use space and clerical services provided by the clinic owner, but conducted separate practices serving clients, they were not employees of the clinic but were independent contractors.

FACTS: Dr. Charles Laufer operates a clinic which provides psychological services. Several individuals who are licensed psychologists see clients at his facility, use the office suite, present their billing information to the office manager employed by Dr. Laufer and pay Dr. Laufer a 40% share of their receivables. Dr. Laufer provides testing supplies and clerical services in addition to office space. These are no written contracts. IRS 1099 forms are issued to the claimants. Dr. Laufer advertises the clinic in the yellow pages under his name. Some of the claimants are not fully licensed (i.e. have limited licenses) and must practice in a fully licensed establishment.

DECISION: Services provided are not in employment and remuneration received was not wages under Section 42 and 44.

RATIONALE: MESC relied on inadequate evidence in reaching its conclusion that services performed by 4 psychologists were in employment. The fact that each contributed 40% of their billings to pay for the overhead does not establish that there was an employer-employee relationship. Reliance on a form filled out only by Dr. Laufer while ignoring his sworn testimony regarding the form was error. Applying the economic reality test yields the conclusion that the psychologists did little more than share expenses at the clinic.

Digest Author: Board of Review (original digest here)
Digest Updated:
7/99

Capital Carpet v MESC – 17.02

Capital Carpet v MESC
Digest no. 17.02

Section 42

Cite as: Capital Carpet v MESC, 143 Mich App 287 (1985).

Appeal pending: No
Claimant: N/A
Employer: Capital Carpet Cleaning and Dye Company, Inc.
Docket no.: L80-03459-R01-1683
Date of decision: May 2, 1985

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COURT OF APPEALS HOLDING: Whether a business is an employer of a worker for purposes of the MES Act depends upon the economic reality of their relationship; under the economic reality test, among the factors to be used are (1) control of the worker’s duties, (2) the payment of wages, (3) the right to hire and fire and the right to discipline, and (4) the performance of the duties as an integral part of the employer’s business towards the accomplishment of a common goal.

FACTS: Carpet cleaners worked under a contractual agreement with Capital Carpet [CC]. They reported to CC every morning and received work assignments for the day. The cleaners used CC’s office to make appointments.

The cleaners received a commission which ranged from 50-60%. All income was turned over to CC and the cleaners were given a paycheck. Income and social security taxes were not withheld. The cleaners rented equipment and purchased chemicals from CC. The costs were deducted from their paychecks. They could purchase their own equipment but chemicals had to be purchased from CC.

The cleaners were in control of the jobs themselves, were not supervised by CC and were responsible for hiring and paying their own help. The cleaners were encouraged to wear CC T-shirts. The cleaners represented themselves as associated with CC’s business and promoted that business. None of the cleaners cleaned on their own or for any other company.

DECISION: The cleaners were employees for MESA purposes.

RATIONALE: CC controlled the overall direction of the cleaners’ employment situation. Moreover, CC paid their wages, and the work done was so integral to CC’s business, neither could exist without the other. In light of the principals of the “economic reality” test, it was clear they were employees.

Digest Author: Board of Review (original digest here)
Digest Updated:
7/99

Socher v Allegan General Hospital – 17.01

Socher v Allegan General Hospital
Digest no. 17.01

Section 42

Cite as: Socher v Allegan Gen Hosp, No. 70531 (Mich App December 29, 1983); lv den 422 Mich 882 (1985).

Appeal pending: No
Claimant: Robert Socher
Employer: Allegan General Hospital
Docket no.: B81 07346 80683
Date of decision: December 29, 1983

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SUPREME COURT HOLDING: In lieu of granting leave to appeal the Michigan Supreme Court reversed the Court of Appeals and trial court and reinstated the Board of Review decision because that decision was supported by competent, material and substantial evidence. The Board found the proper test to be applied is the “economic reality” test.

FACTS: Claimant, an emergency room physician, had an oral contract with the employer. Compensation was $25 per hour or 85% of the patient billings attributed to the claimant, whichever was greater. Taxes were not withheld, nor did he receive fringe benefits. The equipment, medication and instruments were provided by the hospital.

DECISION: The services involved were employment as defined by Section 42 of the MES Act

RATIONALE: The “economic reality” test looks to the totality of the circumstances surrounding the work performed and focuses on the relationship of the worker and his work to the employer’s business operation. See McKissic v Bodine, 42 Mich App 203 (1972). The claimant was not subject to any control as to the manner in which he performed his professional services for any given patient but could assess fees therefor only within the limits prescribed by the hospital and who was obligated to report for work and continue working at such times and throughout such periods as directed by the hospital. He could not hire or fire anyone who assisted him but instead had to accept those provided by the hospital and, at least understood, that he could not perform professional services elsewhere. The claimant’s services were a part of a larger common task, i e., the provision of hospital care to those in need. He was not an independent contractor.

Digest Author: Board of Review (original digest here)
Digest Updated:
11/90

Haas (Flint Institute of Music, Inc) – 17.06

Haas (Flint Institute of Music, Inc)
Digest no. 17.06

Section 42

Cite as: Haas (Flint Institute of Music, Inc) 1983 BR 1694 (L81 02161).

Appeal pending: No
Claimant: Marc W. Haas
Employer: Flint Institute of Music, Inc.
Docket no.: L81 02161 1694
Date of decision: December 28, 1982

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BOARD OF REVIEW HOLDING: The test of employment is one of “economic reality” and not “control and direction” exclusively.

FACTS: Claimant signed a contract with the employer for the 1979-1980 concert season, which incorporated the provisions of the master contract between the American Federation of Musicians and the employer. The claimant furnished his own instrument and clothing. Claimant was paid $25 for each rehearsal and performance. Claimant also performed with the Michigan Chamber Orchestra, the Detroit Symphony Orchestra, and also offered his services as a teacher.

DECISION: Claimant’s services are not excluded under Section 42(1) and (5) of the MES Act.

RATIONALE: McKissic v Bodine, 42 Mich App 203, 208 (1972) sets forth the principal factors to be considered in determining whether there is an employment relationship: First, what liability, if any, does the employer incur in the event of the termination of the relationship at will? Second, is the work being performed as an integral part of the employer’s business which contributes to the accomplishment of a common objective? Third, is the position or job of such a nature that the employee primarily depends upon the emolument for payment of his living expenses? Fourth, does the employee furnish his own equipment and materials? Fifth, does the individual seeking employment hold himself out to the public as one ready and able to perform tasks of a given nature? Sixth, is the work or the undertaking in question customarily performed by an individual as an independent contractor? Seventh, control, although abandoned as an exclusive criterion upon which the relationship can be determined, is a factor to be considered along with payment of wages, maintenance of discipline and the right to engage or discharge employees. In this case, the integrity of Claimant’s services to the employer’s overall objective was persuasive.

Digest Author: Board of Review (original digest here)
Digest Updated:
11/90

Memorial Park Cemetery Sales v MESC – 17.15

Memorial Park Cemetery Sales v MESC
Digest no. 17.15

Section 42

Cite as: Memorial Park Cemetery Sales v MESC, Oakland Circuit Court, No. 80-200-878-AE (October 15, 1980).

Appeal pending: No
Claimant: N/A
Employer: Memorial Park Cemetery Sales
Docket no.: L-76-18035-1564
Date of decision: October 15, 1980

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CIRCUIT COURT HOLDING: When salespeople had no set hours, sales quotas or specific territory to cover, and are paid only on a commission and bonus basis, the salespeople are not under the “control or direction” of the employer and, hence, are not employees.

FACTS: Memorial Park Cemetery Sales is the exclusive selling agent for lots and memorials at White Chapel Cemetery. Memorial Park engages the services of sales representatives for the purpose of selling cemetery lots and memorials under the terms and conditions established by White Chapel. The sales representatives are paid on a commission and bonus basis set by White Chapel. The salespeople set their own hours, use such sales aids and equipment as they desire, are assigned no specific sales territory, furnish their own transportation, and are not required to report to the office at all. The relationship was terminable at will.

DECISION: The services provided by the salespersons were not in covered employment under Section 42 of the Michigan Employment Security Act.

RATIONALE: While the public policy of the Act (Section 2) is directed against involuntary unemployment and in favor of encouraging employers to provide stable employment, the sales representatives here are not under the control or direction of the employer. “As noted above, the relations involved herewith are terminable at will, the salesmen set their own hours and are not required to report to the office at all. The work in question leaves the stability strictly up to the salesmen.” This is not a relationship of the type to be protected under Powell v ESC, 345 Mich 455, (1956).

Digest Author: Board of Review (original digest here)
Digest Updated:
7/99