Dan Churney Jul. 14, 2016, 10:53pm

An Illinois appeals panel has said the Illinois Department of Employment Security was right to order a Skokie furniture moving business to contribute to the unemployment insurance of more than 90 company workers, because the workers are employees, not “independent contractors” as the company tried to classify them. 

The June 28 decision was delivered in First District Appellate Court of Illinois by Justice John Simon, with concurrence from Justices Daniel Pierce and P. Scott Neville. The ruling favored the Illinois Department of Employment Security in its dispute with E-Z Movers. 

The case stems from 2009 when a onetime E-Z worker sought unemployment insurance benefits and the Department of Employment Security saw E-Z had not reported the worker’s wages. The department then looked deeper and found 92 drivers and helpers should have been listed as employees in 2008, but were not; in 2007 the figure was 89. The department told E-Z to pay $25,014 in unemployment insurance contributions for these employees. 

The company contended at an administrative hearing there were several reasons why the workers should be considered independent contractors, not employees. Overall, E-Z claimed the company and the workers were separate entities, but in the same line of business, with E-Z obtaining customers and providing jobs to the movers, and the movers transporting items from A to B. 

The department was not persuaded, concluding in July 2012 the workers qualified as employees, because they were under E-Z’s “control or direction,” as defined by the Illinois Unemployment Insurance Act. In support of this conclusion, the department said E-Z hired and fired movers, scheduled jobs, provided trucks, limited drivers’ use of trucks and prohibited movers from assigning their jobs to anyone else without E-Z’s permission. 

The company then went to court in August 2012 to have a judge overturn the department’s decision, which Cook County Circuit Judge Robert Cepero did in January 2015. The department, in turn, appealed shortly afterward. In looking at the case, the appellate court noted it was reviewing the department’s finding, not that of Cepero. 

Justice Simon affirmed the department’s decision, saying it was “not clearly erroneous.” 

Simon pointed out E-Z failed to satisfy any of the three conditions set forth by the Employment Security Act for designating a worker a contractor, as opposed to an employee. 

The criteria are that the worker be “free from control or direction” of the business, is “independently established” and does work for the company that falls outside the work usually engaged in by the company.

Simon noted the department correctly ascertained E-Z exercised a number of controls over workers, drawing attention to the fact company workers wear E-Z uniforms and drive trucks marked with the E-Z logo. 

Simon also put the brakes on E-Z’s contention it was separate from its drivers – E-Z having said it was on the marketing side of the moving industry, with workers on the blue-collar end. 

“A moving company would not exist without its workers to physically haul the items,” Simon observed. 

E-Z Movers was represented by the firm of Wessels Sherman Joerg Liszka Laverty Seneczko P.C., which is based in suburban St. Charles, with offices in Chicago, as well as Wisconsin, Iowa and Minnesota. The Illinois Attorney General’s Office represented the Illinois Department of Employment Security.

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