Glenn v. Beard
| Decision Date | 20 March 1944 |
| Docket Number | No. 9607.,9607. |
| Citation | 141 F.2d 376 |
| Parties | GLENN, Collector of Internal Revenue, v. BEARD. |
| Court | U.S. Court of Appeals — Sixth Circuit |
Lyle M. Turner, of Washington, D. C. (Samuel O. Clark, Jr., Sewall Key, A. F. Prescott, and Lyle M. Turner, all of Washington, D. C., and Eli H. Brown III, of Louisville, Ky., on the brief), for appellant.
Allen P. Dodd, of Louisville, Ky., for appellee.
Before SIMONS, MARTIN, and McALLISTER, Circuit Judges.
The Collector of Internal Revenue levied and collected Social Security taxes from appellee, who, thereafter, filed a petition in the district court for refund and was awarded a judgment therefor. The court held that appellee was not an employer; that the workers, upon whose asserted employment the taxes were levied, were independent contractors; and that appellee, under the statute, was not liable for the exaction.
The question presented by this appeal is whether the workers in question are independent contractors, exempt from the provisions of the statute, or whether they are employees, subject to the Act.
Appellee maintains studios in Kentucky, where, for many years, she has engaged women to make comforters, quilts, and similar articles. The women do the work in their homes on farms, within a 25-mile radius of a studio. Appellee supplies materials stamped with designs, and specifications for the work are agreed upon. The material and thread, together with the specifications or instructions, are delivered to the worker at the time of the signing of a contract by the worker and appellee. The contract provides that the homeworker will work the material according to the specifications; that the work may be done at such times — within a designated period — and at such places, as are agreeable to the worker; and that, further, the worker may do the work personally or by agents of her selection. It is also provided that upon completion of the specified work and its delivery to the appellee, a certain price will be paid to the worker, who is responsible for any damage or injury to the materials while they are in her possession.
There was no supervision of the work and appellee never even called at the homes of the workers to inspect the work. Payment was made when the finished product was delivered to appellee. Appellee had no right to withdraw the work from a homeworker while it was being worked upon and within the time limit provided by the contract. Other individuals and companies were engaged in the same kind of business as appellee, and often homeworkers would be engaged in working on various materials for several such concerns at the same time, interspersing such work with their household duties. They only worked when they wanted to, and at such times in the year as their farm duties permitted them.
According to the pertinent regulations of the Commissioner of Internal Revenue, promulgated under Title IX of the Social Security Act, 26 U.S.C.A. Int. Rev.Code, § 1600 et seq, it is provided: "In general, if an individual is subject to the control or direction of another merely as to the result to be accomplished by the work and not as to the means and method of accomplishing the result, he is an independent contractor, not an employee." Treasury Regulation No. 90, Art. 205. The Regulation is in harmony with the assumption that the Act took over the term "employee," as the common law knew it, "for it enumerates the generally accredited determinants in such cases, of which the most important is the putative employer's control over the employee's business." Texas Co. v. Higgins, 2 Cir., 118 F.2d 636, 638, 639. As was said in Ruth Bros. v. Stambaugh's Adm'r, 275 Ky. 677, 122 S.W.2d 501, 505, "The main question in all cases of this type is whether or not the one who is claimed to be an independent contractor...
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