Mississippi Employment Sec. Commission v. Plumbing Wholesale Co., 39035

• Decision Date: 25 January 1954
• Docket Number: No. 39035,39035
• Citation: 219 Miss. 724,69 So.2d 814
• Parties: MISSISSIPPI EMPLOYMENT SECURITY COMMISSION v. PLUMBING WHOLESALE CO.
• Court: Mississippi Supreme Court

Page 814

69 So.2d 814

219 Miss. 724

MISSISSIPPI EMPLOYMENT SECURITY COMMISSION v. PLUMBING WHOLESALE CO.

No. 39035.

Supreme Court of Mississippi.

Jan. 25, 1954.

Harry M. Bryan, Robert Prisock, Jackson, for appellant.

Satterfield, Ewing, Williams & Shell, Jackson, for appellee.

KYLE, Justice.

This case is before us on appeal by the Mississippi Employment Security Commission from a judgment of the Circuit Court of the First Judicial District of Hinds County reversing an order of the Commission disallowing an application for a refund of state unemployment taxes paid by the appellee, Plumbing Wholesale Company, to the Commission.

The tax levied by the Commission was levied under authority of Chapter 295, Laws of Mississippi, 1940, known as 'The Mississippi Employment Security Law', and amendments thereto, including Chapter 412, Laws of Mississippi, 1948, Sections 7368-7446, Code of 1942.

Section 19(h)(1) of said law, Section 7440(h)(1), Code of 1942, defines the word 'employer' as follows:

'(h) 'Employer' means:

'(1) Any employing unit which for some portion of a day, but not necessarily simultaneously, in each of twenty different weeks, whether or not such weeks are or were consecutive, within either the current or the preceding calendar year, has or had in employment, eight or more individuals (irrespective of whether the same individuals are or were employed in each such day). * * *'

Section 19(i)(1) of said law, Section 7440(i)(1), Code of 1942, defines the word 'employment' as follows:

'(i)(1) 'Employment' means any service performed prior to the effective date to this act which was employment as defined in this section prior to such date and subject to the other provisions of this sub-section, service performed after the effective date of this act, including service in interstate commerce, performed for wages, or under any contract of hire, written or oral, express or implied. * * *' Section 19(i)(5) of said law, Section 7440(i)(5), Code of 1942, provides as follows:

'(5) Services performed by an individual for wages shall be deemed to be employment subject to this act unless and until it is shown to the satisfaction of the commission that such individual has been and will continue to be free from control and direction over the performance of such services both under his contract of service and in fact; and the relationship of employer and employee shall be determined in accordance with the principles of the common law governing the relation of master and servant.'

Section 7 of the law, Sections 7390, 7391 and 7392, Code of 1942, provides for the payment of the contributions by covered employers according to the schedule and formula therein set forth.

The records shows that the Commission had a field representative make a check for the purpose of ascertaining the number of employees the Plumbing Wholesale Company had during the year 1951, and it was found that the company had seven regular employees each week, including all officers. It was also found that the company had also hired other persons to unload pipes and other plumbing materials, and this extra labor was paid out of the petty cash fund and not carried on the regular payroll. Such labor had been employed on twenty-two different occasions, each occasion in a different week, for unloading cars of plumbing materials during the year 1951. The company was accordingly registered as liable for contributions as a 'covered employer' on wages paid its employees, under the provisions of the Employment Security Law. The taxes were computed and paid; and the company then filed its application for a refund, as provided for in the law, contending that the laborers hired to unload pipes and other materials during the calendar year were independent contractors.

The question prosented for our decision is, whether the lower court erred in reversing the order of the Commission disallowing the appellee's claim for a refund of the amount of the taxes paid. And the answer to that question depends upon the answer to the question, whether or not the appellee had as many as eight or more individuals 'in employment' for some part of a day in twenty different weeks in the calendar year 1951, and was therefore liable for contributions as a 'covered employer' on the wages paid to them. If the laborers who were employed to unload the cars are to be counted, the appellee had as many as eight or more such individuals 'in employment', and was liable for the contributions. If the laborers who were employed to unload the cars are not to be counted, the number of individuals 'in employment' was less than eight, and the appellee was not liable for the contributions.

The proof taken before the Commission showed that the company received about every two weeks one or more carload shipments of pipe and other plumbing materials, which were delivered by the carrier f. o. b. the cars at the company's yard. The company having no regular employees available to unload the cars had adopted a custom of hiring extra labor to unload the cars; and Veal Stack, a colored laborer, had performed this service for the company for several years prior to the year 1951 and continued to perform this service for the company until he became disabled sometime during the year 1951, when McKinley Teague, another colored laborer, took over the job. Veal Stack died during the month of March, 1952. The hearing before the Commission took place on August 8, 1952. McKinley Teague and R. E. Warwick, treasurer of the Plumbing Wholesale Company, testified before the Commission concerning the nature of the employment of the extra help mentioned above; and their testimony was made a part of the record and is now before us on this appeal.

Teague testified that his main occupation was mowing yards and working in flower beds for people who had need of his services, 'just doing yard work.' He had unloaded cars from time to time over a period of years, and had unloaded cars for the Plumbing Wholesale Company since sometime during the year 1951, when Veal Stack became disabled. Whenever a carload of plumbing materials was spotted at the company yard, the company would notify him and he would go to the warehouse and unload it. He usually engaged a helper to assist him. The time required to unload a car was usually about two hours; but, if he had to stack the materials, it took around eight hours. He was paid $20 for unloading each car, and signed a slip when the company paid him for the job. He paid his own helper out of the $20, if he had used a helper in unloading the car. When he started to work he was told where to stack the pipe and other plumbing materials. He was told that he must have separate stacks for the different kinds of materials. He did not have to be told that again. No one stayed there and supervised him during the unloading. He had no regular hours of employment while he was doing the work. He never worked at a job of that kind by the week or the month. His regular work was yard work. On cross-examination Teague stated that he furnished no special tools when working for the plumbing company. He did not hold himself out to the public as a man engaged in unloading cars only. He unloaded the cars, put the plumbing materials in the warehouse anywhere he could find places for them, and stacked the pipes on the company's yard, which was enclosed by a fence. He made separate stacks for different sizes of pipes. So far as he knew, he did all of the unloading for the company.

R. E. Warwick testified that Stack unloaded the cars for the company until sometime during the year 1951, when Teague took over the job. He stated that Stack and Teague employed their own helpers, but when he paid them he usually divided the money--'changed the money for the contractor.' He said he did not supervise the 'unloaders', did not have time to do that. But he admitted that he had given directions as to the places where the supplies were to be put. 'We have directed them not to put water heaters where they put them last time.' If he found any part of the work done wrong, he would tell the 'unloader' how to do it. If the occasion arose for a change in the work during the unloading, he would not hesitate to tell the workman what change he wanted. 'It is like this. On occasion we have found that it would be more efficient for us in loading pipe on trucks to have a certain size of pipe here. * * * and we find that half-inch galvanized pipe would be distributed more easily to the customer if it were over there. If a stack of pipe gets down, we might tell this man, 'Don't put your half-inch there, put it here." 'Q. That is right on the site, and at the time he is doing the work? A. Yes. It would have to be before he started. You don't have him tear down a tier.' Warwick stated that the work that Stack and Teague were doing was common labor. 'We were buying the product of their back and not of their mind.' He stated that it was not a skilled job, but it was a job that needed experience.

What then was the relationship between Stack and the plumbing company, and between Teague and the plumbing company? Were Stack and Teague employees or sevants of the company, or were they independent contractors? 'Servant' and 'independent contractor' have been defined in Restatement of...