Steel & Machinery Transportation
v.
Illinois Workers' Compensation Commission
By: Cody D. Hartman
Case Synopsis:
In cases involving the issue of employer-employee, the Court continues to examine the control the employer has over the employee. The employer, a trucking company enforced certain policies with its employees in compliance with federal regulations. The Court noted that though the employer was required to comply with federal regulations, it did not diminish the fact the employer was still exerting control over the employee.
Case Facts:
Claimant is an over-the road truck driver who lost a portion of his left lower extremity in a motor vehicle accident. Claimant filed an Application alleging the Respondent as employer. At the time of the accident, the parties operated under an “Independent Contractor Agreement.” The agreement noted the following:
· Respondent owned all equipment, including the semi and trailer,
· Claimant needed to maintain insurance when not carrying a load,
· Claimant would be compensated at a specified percentage of the revenues,
· Claimant is responsible for all licenses, permits, oil, fuel, and tolls, and
· Respondent held the right to mark the semi and trailer as it saw fit.
In addition, Claimant was responsible for having the truck and trailer inspected and maintained in accordance with federal regulations. Claimant testified that he worked with a dispatcher and had to check in about every two hours. Claimant also could not refuse to carry a load and could not choose which loads he wanted to transport.
The Court noted the five-part test in determining an independent contractor. Among the factors are: (1) whether the employer may control the manner in which the person performs the work; (2) whether the employer dictates the person’s schedule; (3) whether the employer compensates the person on an hourly basis; (4) whether the employer withholds income and social security taxes from the person’s compensation; (5) whether the employer may discharge the person at will; and (6) whether the employer supplies the person with materials and equipment. The Court noted the right to control the work and the nature of the work are the two most important considerations.
The Court reviewed the Agreement noting Respondent held exclusive possession, control, and use of the equipment. The Court held that although Respondent purported to include this factor in compliance with federal regulations, it does not diminish the fact Respondent had the right to control Claimant’s activities. The Court noted Claimant was required to check-in every two hours and could not refuse a load. Although the court found that there were factors that weighed for, and against Claimant being an independent contractor, the Court held Claimant to be an employee of Respondent.
Impact on Illinois Employers:
In this case, Justice Holdridge wrote a strong dissent arguing the manifest weight of the evidence established Claimant was an independent contractor. The dissent noted that under the court’s current interpretation of the law, it has become virtually impossible for a trucking company and an independent driver/lessor to structure their relationship in a way that reliably precludes a finding of an employment relationship, even if it is the clear and expressed intent of both parties.
The dissent noted Claimant would be compensated a percentage of revenue rather than paid a salary, Claimant was responsible for licensing and fuel, Claimant had to maintain insurance while not carrying a load, and that Claimant could drive for other carriers –all factors in support of an independent contractor. The dissent argued “Under our court’s current approach, the Commission can almost always find an employment relationship and, once the Commission had made such a finding, we will affirm the Commission’s determination so long as there is any evidence that even arguably suggests an employment relationship.” The dissent ultimately calls for the courts to re-evaluate their tests and standards in evaluating employer-employee cases. We sincerely hope the courts will heed Justice Holdridge’s dissent and review their standards and tests when evaluating employer-employee cases.
