Speaks, Inc. v. Jensen
| Decision Date | 28 May 1976 |
| Docket Number | No. 46042,46042 |
| Citation | 243 N.W.2d 142,309 Minn. 48 |
| Parties | SPEAKS, INC., d.b.a. Kirby Co. of Minneapolis, Respondent, v. Jens P. JENSEN, Jr., claimant, Respondent-Below, Commissioner of Employment Services, Appellant. |
| Court | Minnesota Supreme Court |
Warren Spannaus, Atty. Gen., Peter W. Sipkins, Sol. Gen., Peter C. Andrews, Asst. Atty. Gen., Frank W. Levin, Sp. Asst. Atty. Gen., St. Paul, for appellant.
Harstad & Rainbow and Douglas R. Rainbow, Minneapolis, for respondent.
Considered and decided by the court without oral argument.
The commissioner of manpower services appeals from an order of the Hennepin County District Court reversing the commissioner's order finding that Speaks, Inc., is an employer for purposes of the Minnesota law of unemployment compensation and that services performed for Speaks are employment covered by that law. Minn.St. c. 268. We affirm.
Speaks, Inc., is engaged in the business of selling Kirby vacuum cleaners in Minnesota pursuant to an agreement with the Kirby factory in Cleveland, Ohio. Speaks engages dealers to sell the cleaners by door-to-door home solicitation.
The dealers, as a rule, become involved with Speaks through response to a newspaper advertisement and an interview. Those who are accepted sign an 'Independent Dealer Agreement' and are offered a 3 1/2-day uncompensated training program designed to familiarize them with the basic layout of the machine and instruct them as to sales techniques. They are provided order forms, a suggested price list, credit contracts, and a vacuum cleaner on a 30-day consignment. Voluntary sales meetings are held twice a week at the Speaks place of business. The dealer agreement may be terminated at any time by either party.
The dealers are free to establish the principal incidents of their sales activities. They are not required to work specific hours or days or any number of hours or days. They are not assigned or limited to a particular territory. They are free to sell any other products including those of competitors. They may employ assistants but are solely responsible for their compensation.
The dealers are compensated on a profit basis. They may sell the cleaners at any price but are obligated to Speaks for the wholesale price of the machines. On cash sales the dealers retain the difference between the sales price and the wholesale price. Credit sales contracts are turned in to Speaks, who in turn assigns them to a finance company. Speaks verifies sales for credit purposes only. The dealers receive the excess of sales price over wholesale. Although the dealers may accept trade-ins as part of the purchase price, they turn them over to Speaks without remuneration. The dealers sell the machine they have on consignment, pay the wholesale price out of the sale proceeds, and receive another on consignment. They may, at their option, pay for a machine in advance or take several machines on consignment at one time. Title on machines taken on consignment remains in Speaks.
Dealers generally work out of their homes. Speaks does not provide offices, desk space, or business phones. It does not pay any of the dealers' expenses, nor does it make advances. It does not carry liability insurance on the automobiles used by the dealers or withhold social security or income tax for them.
The commissioner of manpower services held that Speaks was an employer as it had the requisite right to control the means and manner of the dealer's performance through its unconditional right to terminate. The district court reversed, holding that the relationship between Speaks and its dealers was that of vendor and vendee.
' Employment' for the purpose of unemployment compensation cases is defined in Minn.St. 268.04, subd. 12. That section provides in part as follows:
"Employment' means: (1) Subject to the other provisions of this subdivision 'employment' means service performed prior to January 1, 1945, which was employment as defined in this section prior to such date, and Any service performed after December 31, 1944, including service in interstate commerce, By an individual who is a servant under the law of master and servant or who performs services for an employing unit, Unless such services are performed by an independent contractor.' (Italics supplied.)
In determining the status of the dealer salesmen under this statute, we apply the same standards of the law of master and servant as are used to distinguish an employee from an independent contractor in workmen's compensation decisions. 1
In Guhlke v. Roberts Truck Lines, 268 Minn. 141, 143, 128 N.W.2d 324, 326 (1964), we stated those standards to be as follows:
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Abel v. Abbott Nw. Hosp., A19-0461
...cases. See, e.g. , Wangen v. City of Fountain , 255 N.W.2d 813, 814–15 (Minn. 1977) (workers’ compensation); Speaks, Inc. v. Jensen , 309 Minn. 48, 243 N.W.2d 142, 144–45 (1976) (unemployment compensation). In doing so, we considered five factors derived from common-law agency principles: "......
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Neve v. Austin Daily Herald, C9-96-156
...question arises in a reemployment insurance, as opposed to a workers' compensation or tort, case. See Speaks, Inc. v. Jensen, 309 Minn. 48, 50 & n. 1, 243 N.W.2d 142, 144 & n. 1 (1976) (requiring courts to follow an identical employment-status analysis in reemployment insurance and workers'......
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Wallis v. Secretary of Kansas Dept. of Human Resources, 55788
...Superior Products, Inc., 89 Ariz. 119, 358 P.2d 997 (1961). The only case which has reached a different result is Speaks, Inc. v. Jensen, 309 Minn. 48, 243 N.W.2d 142 (1976). The Kirby vacuum cleaner distributors had been found liable for unemployment compensation under virtually the same c......
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BKU Enterprises, Inc., Matter of
...Only one court has concluded Kirby dealers are independent contractors for unemployment compensation purposes. See Speaks, Inc. v. Jensen, 309 Minn. 48, 243 N.W.2d 142 (1976). Job Service found BKU retained the right to direct and control the services performed by the dealers. A reasoning m......