SOUTHWEST APPRAISAL GROUP, LLC v. ADMINISTRATOR, UNEMPLOYMENT COMPENSATION ACT, SC 19651
Judicial District of Ansonia/Milford
Unemployment Compensation; Whether Auto Damage Appraisers Employees or Independent Contractors Under ABC Test; Whether Appraisers Properly Deemed Employees on Ground that they were not Customarily Engaged in an Independently Established Trade or Business. The plaintiff operates an automobile damage appraisal business. The plaintiff’s clients are insurance companies, and when an insurer contacts the plaintiff concerning claims for damage to automobiles, the plaintiff contacts a licensed appraiser to provide an estimate of the damage. The defendant ruled that the plaintiff was liable for unemployment contributions on determining that three of the plaintiff’s six appraisers were the plaintiff’s employees and not, as the plaintiff claimed, independent contractors. The defendant found that the appraisers were employees on applying the ABC employment test codified in General Statutes § 31-222 (a) (1) (B) (ii). The ABC test provides that the statutory presumption that an individual who performs a service is an employee can be rebutted on a showing that, among other things, the individual performing the service “is customarily engaged in an independently established trade, occupation, profession or business of the same nature as that involved in the service performed.” The plaintiff appealed to the trial court, and the court dismissed the appeal, concluding that the board did not act arbitrarily or illegally in concluding that the appraisers were the plaintiff’s employees and not independent contractors. The court determined that, while the three appraisers maintained their own offices and equipment, were responsible for maintaining their licenses, and had their own business cards, they were not “customarily engaged” in an independent business as contemplated by part C of the ABC test absent any evidence that they had actually provided services to anyone other than the plaintiff during the audit period. The plaintiff appeals, claiming that the trial court wrongly ruled that the appraisers were employees on finding that the plaintiff did not show that they performed work for others during the audit period. The plaintiff contends that the court wrongly interpreted part C of the ABC test, and wrongly grafted a new requirement onto part C, by effectively requiring the plaintiff to demonstrate that the appraisers were independent contractors because they were customarily engaged in an independently established and successful trade, occupation or business. The plaintiff argues that, in analyzing whether the “customarily engaged” requirement of part C has been satisfied, the focus should be on the steps taken and efforts made by the putative independent contractor to perform work for others and not on whether those efforts were ultimately successful.