Company did not rebut presumption of employment under Construction Industry Fair Play Act; case remanded
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Friday, July 17, 2020

Company did not rebut presumption of employment under Construction Industry Fair Play Act; case remanded

By Payroll and Entitlements Editorial Staff

A construction management company was not liable for contributions on remuneration paid to the claimant and others similarly situated who performed residential renovation and remodeling work. The ALJ found that the company had not rebutted the presumption of employment created by the Construction Industry Fair Play Act, which permitted a contractor to rebut the employment presumption by showing that the 12 criteria of the "separate business entity test" were applicable to its workers. The Board adopted the ALJ's factual findings and legal analysis and made additional findings that the company failed to satisfy two of the three criteria of the statutory "ABC test" used to rebut the presumption of employment. The company appealed. The court ruled that the first criterion in the separate business entity test does not require a contractor to show a total lack of direction or control over a business entity, but instead that the relationship as a whole did not show sufficient "control over the results produced or the means used to achieve the results" by the contractor to reflect an employer-employee relationship. Although the factual findings already made by the Board would appear to permit the determination that the company did not meet the first criterion under the analysis, the court reversed and remitted the case so that the Board could answer that question (In the Matter of the Claim of  Daniel W. Tuerk, N.Y. Sup. Ct., App. Div., Third Dept., No. 528857, June 18, 2020).

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