Unemployment compensation and Partnerships

Unemployment Compensation and Partnerships
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Question 1: The Case of VIP Tours, Inc v/s Cynthia Hoogland
VIP Tours, Inc. arranged tours of central Florida’s attractions for visitors to the area. Cynthia Hoogland conducted 29 such tours for VIP between July 1980 and March 1981. Both Hoogland and VIP considered Hoogland an independent contractor. She worked for VIP only when it needed her services, and could reject particular assignments. She was also free to work for other tour services, and did so.
Once Hoogland accepted a job from VIP, she was told where to report and given instructions about the job. She was required to use a VIP-furnished vehicle and to wear a uniform with the VIP logo when conducting tours. Aside from ensuring that she departed on time, however, VIP did not tell her how long to stay or what kind of tour to conduct at each tourist attraction. Hoogland was paid on a per-tour basis.
Hoogland later filed a claim for unemployment compensation benefits with the Florida Division of Labor and Employment Security. The division concluded that she was entitled to these benefits because she was a VIP Tours’ employee. VIP appealed the division’s order to an intermediate appellate court.
Please decide if she was entitled to unemployment compensation benefits or was not entitled to unemployment compensation and show your reasoning. Please make sure that you are thorough. Do not assume any facts and please distinguish as clearly as you can on as many legal and factual bases what your reasoning is behind your conclusions.
Hoogland may not be eligible for unemployment benefits. This is because for one to be eligible for these kinds of benefits, he or she must first be considered an employee of the company. Although the aspect of one being labelled as an independent contractor does not automatically exclude one from being considered an employee, many factors are considered for a clear determination of the issue. Employees are entitled for a monthly wage or salary, in this case, Hoogland who was hired as a tour operator was paid on as per tour basis. This is a clear indication of her independent status. At the appellate court, she will be asked to produce all salary or wage records earned over the last year.
Companies also provide certain benefits to their employees such as social security, unemployment insurance, Medicare, bonuses and other benefits (Fabio, 2010). Mrs. Hoogland was not entitled to these benefits, as she was not considered and employee of the organisation. The mutual agreement between Hoogland, and VIP was that of independent contractor relationship and as such, she performed her duties independently. Moreover, the services performed by her were out of the business premise, in other words, her schedules and place of work were not specified hence giving her autonomy on how to go about her businesses.
In the light of the Unemployment benefit act, the person or rather the employee requesting for unemployment benefit compensation must be under the jurisdiction of the employer. In other words, the employee should be working under the direction of the company and not at his or her own directive. In this case, Hoogland was not under the company’s directive as she could either decide to report working or not; she could either accept or deny the tasks she was allowed to work for other companies. How Hoogland managed the operations while at work was on her own accord. As an independent contractor, the company had given her full autonomy in the business and did not execute any condition pertaining to work schedule. Employees could be subjected to a more regulated arrival and closing time and the quantity of work performed.
Although the contractor was assigned duties and required to report working on designated time, she was not given operational time span or schedules on how to conduct the business. Hoogland however, was required to use the VIP vehicle. She was as well required to wear a uniform with the companies’ logo each time she was performing VIP operations. This may not however, be used as defence grounds against the company. This is due to the fact that the law accepts the use of company tools and identification elements by whoever conducting work or business on behalf of the company. Recognising her as an independent contractor, VIP could not subject her normal routine operations such like other regular staff. In other words, she was free to accept or decline assignments offered by her by the company.
Being paid on a per tour basis, there was no binding force between VIP and Hoogland, their pay agreement was therefore, based on “a pay after job basis” There was no agreement for pension, bonus, vacation, sick pay or whatsoever to account for the employer employee relationship. Moreover, Hoogland was not even involved in social security tax at VIP, a fact that could jeopardise her quest to receive the unemployment benefits. The law requires that all employees submit their tax returns at the relevant authorities (Jason, 2010). For a person to be considered as eligible for compensation of “non-employee benefits”, his or her tax submission must be determined and backdated to four years. It should be understood that Hoogland had provided services at VIP for a period that did not exceed one year. Moreover, her taxes could never be substantiated since she could not contribute taxes to the revenue authorities.
Workers who are not directly under the control of the company cannot be declared as employees of the company (Chang, 2012). Although Hoogland received instructions on how to conduct the operations, she was not supervised by the company’s supervisors. Additionally, she could still reject certain tasks which she deemed not interesting for her. Despite this, she could still be retained at the company to conduct businesses as an independent contractor, again pointing out the validity of her status as an independent contractor.
Although the VIP required Hoogland to be reporting to work on time, this can be no defence for her, as the nature of work required that strict observance of arrival time. It is common sense that whoever working for the company be it an employee or an independent contractor must work towards meeting the organisation’s interest and goals. The issuance of company vehicle and uniform ...