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  1. #1
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    Mar 2015
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    Default Misclassified Independent Contractor Denied Unemployment for Tardiness

    My question involves independent contractors in the state of: Connecticut

    I worked for a CPA/Financial Advisor as an admin for 2.5 years. Upon being hired, I was told I would be a 1099, and thought nothing of it. The woman I replaced made mention of how "Cheap" our employer was, so I kept my radar up. Eventually I began to see that his business ethics were barely legal, at best. He would recommend investments based on the biggest commissions, had one gentleman out of work and going thru a divorce take his funds from a plan he could have withdrawn from at any time without any penalty should he need to pay his new mortgage or pay child support during his unemployment period to a plan that he couldn't touch the funds for seven years without double the usual penalty from the IRS and company itself and would blatantly lie to people to get them to sign documents so he could get paid. He hid many things from the firm we cleared with so he wouldn't have to pay overrides. Several files had documents that were blank but signed, or withdrawal requests from prior years with white out and a new date input. I noticed that even when I presented additional hours worked, he stated he would only pay me the agreed upon hours and nothing more. I started keeping track.

    Fast forward to the end of our working together, and I was advised from a friend he misclassified me. So I filed for unemployment. I also submitted for the past due wages. Both divisions of the DOL found that he had misclassified me, and that because he had no records of time sheets or anything, he had to pay the back due wages. Ironically, he provided a W2 for those wages and took taxes out, but for the remainder of the income I made at that time, he provided a 1099-MISC, just as he had for the past years.

    Of course my unemployment was denied, citing wilful misconduct for consistent tardiness, all of which he was aware of. I explained to the person from UI that I had been found to be misclassified and she denied the claim anyway. I received my decision and began to prepare my appeal when several medical issues arose, and I was 2 days late in filing my appeal.

    The hearing was held, and the denial reversed, citing that I had just cause in being late in filing my appeal under CT Gen Statutes 31-237g-15b-vii, and also that the boss had "condoned" my tardiness because his initial claim, citing only 3 instances was replaced with 70 instances using the gate entrance times due to his inadequate records.

    Being the way he is, he appealed the decision, claiming wilful misconduct. The board of appeals reversed the decision in his favor.

    I also received a second letter stating that they listened to the recording of my appeal and state that my claim of the confusion of dates due to medical issues versus my statement of "fell by the wayside" is not consistent. I didn't realize I needed to fully document every single medical condition and thought that my documentation provided at the hearing was sufficient. Most state agencies rely on facts, I provided the facts, it was a medical issue. I didn't want to say because of extensive pain, high doses of pain medication and multiple appointments, things got confused. It did not sound factual. It fell by the wayside due to medical issues, enough said. And I filed 2 days late, not 5, or 10. TWO.

    And now I can either motion the board to reopen or take it to the Supreme Court, which either way, he has given me more than enough evidence with the tax documents, please everything else I have.

    Here are my questions:

    1) Why, if it was found that I was terminated as a 1099 and NOT an employee, are they allowing me to be fired as a 1099 for an employee reason? Why would the UI interviewer not even consider that in her findings?

    2) Which would be the best solution? Take it to the Supreme Court or ask them to re examine everything, providing the new evidence? Being that my medical issue continues to this day, almost 5 months later, I don't exactly have the funds to hire an attorney, but have no problem fighting it representing myself. If just don't know which cases to cite when I go to the Supreme Court or even to the Board of Appeals.

    Any input would be much appreciated. Even if you know of or are an attorney looking for good karma and are willing to do this pro bono or on a payment plan and want to help someone who stayed at this position because elderly people were having their funds mismanaged for better commissions (something I will be taking to the Dept of Banking and SEC once this is over), then please let me know. But any suggestions or recommendations from others in similar situations would be greatly appreciated.

  2. #2
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    Sep 2010
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    Default Re: Misclassified Ic in Connecticut

    You've lost me on question #1. Independent contractors aren't eligible for UI. You were recharacturized as an employee because they felt you WERE an employee (for this you should be lucky. Note you should also go back and amend your tax returns for prior years and file to recover the share of the SE tax you paid that should have been covered by the employer). Once you're been determined to be an employee, then they need to see if your termination was due to your own misconduct. I'm not having a lot of luck deciphering the sequence here (especially with your failure to submit timely appeals, hopefully you got a ruling that the delay was for due cause).

    You can't just take things to the Supreme Court after some administrative board rules against you. You need to pursue whatever administrative appeal process there is and THEN you might be able to bring it to Superior Court for action.

    The Connecticut DOL web site seems to have plenty of information on the process. A lawyer may be able to keep you from screwing up though.

  3. #3
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    Oct 2006
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    Default Re: Misclassified Ic in Connecticut

    Quote Quoting flyingron
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    You've lost me on question #1. Independent contractors aren't eligible for UI. You were recharacturized as an employee because they felt you WERE an employee (for this you should be lucky. Note you should also go back and amend your tax returns for prior years and file to recover the share of the SE tax you paid that should have been covered by the employer). Once you're been determined to be an employee, then they need to see if your termination was due to your own misconduct. I'm not having a lot of luck deciphering the sequence here (especially with your failure to submit timely appeals, hopefully you got a ruling that the delay was for due cause).

    You can't just take things to the Supreme Court after some administrative board rules against you. You need to pursue whatever administrative appeal process there is and THEN you might be able to bring it to Superior Court for action.

    The Connecticut DOL web site seems to have plenty of information on the process. A lawyer may be able to keep you from screwing up though.
    I agree wholeheartedly that you should amend your past tax returns to reclassify the income as wages (you use form 8919 to do so) and to get back the employers share of social security and medicare taxes that you paid. That has an added benefit of having the IRS go after him which will cost him dearly.

  4. #4
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    Default Re: Misclassified Independent Contractor Denied Unemployment for Tardiness

    We appear to be speaking only of determinations made in relation to your application for UI. To have your tax situation revisited, you should file complaints with the State Department of Labor and form SS-8 with the IRS.

  5. #5
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    Default Re: Misclassified Independent Contractor Denied Unemployment for Tardiness

    It appears (reading between the lines) that the state DOL has already made a determination that not only he is an employee but non-exempt which is why he got W-2's for back pay.

  6. #6
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    Mar 2015
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    Default Re: Misclassified Independent Contractor Denied Unemployment for Tardiness

    Sorry for losing you in this mess. In my head, I know all the facts and am trying to be direct with the details but in rereading, see where it can be confusing.

    The DOL found me to be an employee, not a 1099, but this was after the boss terminated me WHILE I was still a 1099. When the UI determination hearings were being conducted, I was still viewed as a 1099 because the Field Audit Unit hadn't completed their investigation. Once they did, they submitted that I was, in fact, an employee and not a 1099. I was however, terminated as a 1099 for an employee reason. You can't claim someone is a 1099 when you dictate the time they work and various other items, per the CT ABC laws and Joint Enforcement Task force on Misclassification guidelines.

    I have filed my SS8, and will be amending returns.

    The irony in all of this is that he is a CPA and should clearly know the difference between an employee and a 1099.

    My original appeal was approved for medical reasons as my cause for delay. The response I received in response to his appeal to my appeal was from the Ct Board of Appeals is as follows: "This decision shall be final on the thirty first calendar day after the date of mailing unless BEFORE THAT DATE, a party appeals this decision to the Superior Court or moves the Board to reopen, vacate, set aside or modify the decision."

    And lawyers cost money. Current medical issue us preventing me from means of obtaining money. It's either I fix this health mess, which is a mess as well, or I work, exacerbate the issue and hire a lawyer that I can't afford.

  7. #7
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    Default Re: Misclassified Independent Contractor Denied Unemployment for Tardiness

    Okay, the problem is NOT with your drawing unemployment after being misclassified as a 1099. You have already been determined to be misclassified as a 1099, have been determined to be a regular employee, and thus monetarily eligible for unemployment benefits if otherwise approved. The rest of this issue the agency will work out with your former employer.

    And since you were a 1099, you were supposed to be able to set your own hours. But you were terminated for a reason that would be applicable to a regular employee, which was tardiness. So it sounds as though you should have been pretty much a slam dunk to be approved, at least in the initial decision. Is this what happened?

    But then you lost me. It appears there was an appeal, and there was a hearing, and that first decision was overturned and you were denied, right? Am I following this progression correctly? And you filed your appeal of this denial several days late, due to, as you claim, medical reasons. So the claim was denied. Right?

    Now you have appealed the fact that the appeal was filed late, citing medical reasons, right? And they have either said yes you have the right to file an appeal, or no you do not file the appeal timely, because you did not file the appeal timely, the reason wasn't extreme enough, or you didn't submit enough documentation.

    But you have me totally completely confused. There is NO reason you should be talking about how you want to send this to the supreme court(?????) No way you could do this anyhow. The phrase they use is "superior court." The next appeal level would be to the superior court. What this usually means is that the appeal has gone through all the steps of the in-agency hearings, initial decision, second decision after a hearing and appeal to the board of review.

    And anyone who wishes to pursue this claim further would need to take it into the regular courts. And I can assure you that if the benefits have not been approved in the agency, the chances are very very slim that the outcome would be any different in a regular court. Even if you had the best attorney in the world, they can't change unemployment law. And the unemployment system will have its own attorneys to defend their decision.

    Frankly, the only genuine medical reason I could see for anyone to be late in filing an appeal to a claim decision would be if you were in a coma or something. All you had to do was send in the paperwork requesting an appeal. You did not have to be anywhere, or produce any paperwork or argument or present your case or anything of that nature. Are you telling us you missed a hearing due to health reasons, or that you just were a couple of days late filing the appeal? If you were, regardless of how good your arguments were, you'll probably be denied your opportunity to appeal. It's hard to imagine somebody being too sick to mail an envelope unless they were involved in a really serious health crisis or accident or something of that nature.

    And your last sentence "current medical issues preventing me from means of obtaining money. It's either I fix this health mess, which is a mess as well, or I work, exacerbate the issue and hire a lawyer that I can't afford" has got me totally mystified.

    If you have a chance to work, you need to be working instead of drawing unemployment. If your health is such that working is not a possibility for you, then you wouldn't be eligible to receive unemployment anyway, even if you'd been approved every way in the world. Unemployment insurance is in no way a disability insurance. In order to receive unemployment, which only lasts 26 weeks maximum in any state anyhow, you must be able, available and actively seeking work every week you file for it.

    Why are you wandering around talking about going back to work, hiring a lawyer and appealing this? Appealing what?

    Other than making any appeals that you need to make, which you can do by simply saying, "I wish to appeal this decision" I'd forget unemployment, is what my advice to you would be at this point.

  8. #8
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    Default Re: Misclassified Independent Contractor Denied Unemployment for Tardiness

    These decisions are all about the WHY.

    The 1099 vs employee isn't really relevant to your termination. Being reclassified allowed your 1099 to become wages for purposes of establishing a base period. That's over.

    Then there is the separation and the late appeal. That's TWO issues.

    The ALJ at the hearing was allowed to say that you had good cause to be late in filing, but the board of review is just as free to say that your appeal was late and that you didn't have good cause. My question is: did the board of review say that you filed late? If so, then the original adjudicator decision kicks in and it doesn't matter anymore that that the ALJ said you were or weren't late to work because in effect the board is saying that your appeal hearing shouldn't have even taken place because you were late filing the appeal and it shouldn't have been heard on the merits anymore.

    Then did the board say that your termination wasn't for misconduct or did they reverse that too? The idea that as a 1099 you came and went as you pleased doesn't change anything. You can be an employee with a loose schedule, fired for tardies or attendance, and if you can show that you had no set schedule at work, you can still get UI benefits. You managed to do this already. You weren't fired a reason that only an employee can get fired for.

    Then you have this medical stuff. It could be that you might not be eligible anyway because of able and available issues.

    There is NO new evidence allowed as you go further in the appeal process except in some really narrow circumstances, and I'm not reading anything in your story that makes me think you have a reason to be allowed that option.

    As to the Supreme court that was mentioned, maybe CT is like NY, and they call what anyone else calls the superior court, the supreme court, but it's really the next step on the appeal ladder.

  9. #9
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    Mar 2015
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    Default Re: Misclassified Independent Contractor Denied Unemployment for Tardiness

    In my sleep deprived state, I misread Superior Court and not Supreme. So yes FLYINGRON, you are correct, it was Superior and NOT supreme.

    Because of my limited experience with unemployment, appeals and 1099 employment, this is where the majority of my questions come into play.

    I am confused myself because I am uncertain of the process. There is a substantial amount of information about how unemployment works but not in my specific situation. I was under the impression that the initial claim should not have been denied BECAUSE of the misclassification. I mentioned that my termination occurred while I was a 1099. The determination that I was actually an employee took place during the Field Audit conducted by the DOL in determining my unemployment eligibility.

    Had I not had a workers comp lawyer working on a case for an injury from another job where I was injured in 2013, I would have never know of the misclassification at all. He is strictly workers comp, NOT labor relations, or I would defer to him for questions.

    To provide more clarification, here is a timeline. Again, as I mentioned, I know all of the facts in my head, and in an effort to try and maintain discretion, I have tried to keep it simple.

    2012 - hired as 1099 employee by a CPA initial hours set by employer
    2013 - family member had major surgery, requested later start time to do morning care for said family member, employer agreed to later start time. Mid 2013 injured at second job, had physical therapy and doctors appts that overlapped with this 1099 job, also advised employer of this. He even had to write a letter to WC carrier to cover hours that were missed for appts, stated I was a 1099 employee.
    2014, advised employer of sharing vehicle with another, always kept him in the loop about in and out times if they did not fall in line with what we discussed/he requested.

    Week prior to termination, provided a timesheet that included a day that I actually missed due to illness, complete with doctors note, but he rushed me to provide it so I copied the previous week and did not omit the day I missed. The next day, he advised me he reviewed the timesheet and accused me of being dishonest (given his recent and upcoming regulatory authority audits, I find that statement ironic and hypocritical) The following week, I was terminated.

    Week after termination, WC lawyer reached out to ask why I was a 1099 and if employer could change it to a W2. I advised him of termination and told him that may not be possible. He suggested applying for unemployment to have them determine my true status.

    Had initial call with UI representative. She took my information, citing that the employer, in his statement to UI, claimed that I was tardy a "handful of times", and that I was also ineligible due to 1099 status. This triggered a Field Audit to make that determination.

    At the same time, I also filed with Wage and Hour division for unpaid hours. They also were reviewing my 1099 status.

    Received a second call from UI rep who received a letter from employer, changing his initial statement of tardiness "a handful of times" to including the building security entrance times, as he did not have ANY records reflecting my hours worked, dates I was tardy, dates he "claimed" to have verbally warned me, nothing specific to when I actually worked there. The denial letter said I could appeal. Part of it was confusing the dates with medical appointments and part of it was that everything else I had encountered was business days, not calendar days. Add in high doses of strong pain meds and valium combined with very little, if any most nights, sleep, and the confusion occurred. I should have been more thorough. I usually am.

    At the same time, both Wage and Hour and the Field Audit determined me to be an actual employee/W2 and NOT a 1099. So my employee determination status was made AFTER termination.

    When I realized that my appeal date had come and gone, by 2 days, I submitted the appeal online immediately. This is when I received notice of the appeal hearing. During the appeal hearing, the referee stated there were two items to be addressed. One was if I had just cause for filing late and the other was to determine if the employer had just cause for denying unemployment benefits after the termination. The employer answered the referees questions, but could not cite specific dates for verbal or written warnings. He in fact stated that the last warning I received was the day I was terminated, which wasnt true, I was called into his office and let go, so he couldn't even recall the events due to insufficient records. I mentioned that I was a 1099 found to be a W2 employee at the end of the call. I provided copies of medical information to the referee regarding emergency room visits, doctors visits etc, so I did have substantial documentation.

    I received a follow up letter from the referee stating I had just cause in filing late and also that the employer condoned my tardiness, as it had occurred several times more than he originally stated and he did not have records of anything reflecting my hours. In one of the last sentences, this referee mentioned the misclassification. The denial was reversed and benefits awarded.

    Of course, he appealed, citing Section 31-236-28, 31-236-26a and 31-236-26b. The ironic thing, in his fifth paragraph, in citing 31-236-26a, he says at time the EMPLOYEE committed the act, when he had terminated me as a 1099.

    The Board of Review claimed that I did not have sufficient reasoning for filing the claim late and they reversed the referee's decision and also wrote "The claimant's appeal to the referee is dismissed for lack of jurisdiction." How is that possible? How can the referee have lack of jurisdiction?

    I then received a second letter stating that they reviewed the tape from the hearing, which why they didn't do so in the first place is beyond me. The reasoning was the same, but the jurisdiction thing is baffling to me. But in NEITHER of the letters that the Board of Review sent did they mention anything about the misclassification.

    My thought is to motion the Board of Review to reopen/modify this verdict, if you will. The Board only reviewed his appeal, but none of the reasoning he cited was even included. It all had to do with the timing of my submission. My thought is that I shouldn't have been denied to begin with BECAUSE of the misclassification. And the fact that when Wage and Hour completed their review and determined that the employer had no records whatsoever, he had to pay me for the hours I kept track of and he didn't. And those were the ones I had hard copy of, the others were on a flash drive that got misplaced. The employer sent me a W2 for the back wages, but a 1099 for the other wages for 2014. Ironically, the unpaid wages cover 2013 AND 2014, so the fact that he gave the W2 kind of puts him in the hot seat with the IRS and CT DRS, hence the IRS SS8 and 8919 forms and amended returns I will be providing.

    Please don't be mistaken, I am a workaholic, and have for the majority of my working life, worked more than one job because I'd rather work hard now and not have to when I am of retirement age. I am a second generation military brat and laziness was not something we ever practiced. I don't want to be one of those folks who sits and collects money for not doing anything. While I am typing this, I am also coordinating appointments, scanning all of the documents in to have them optically stored and a few other tasks. I am not lazy and looking for a payday by any means. Yes, I do have a medical issue, which if the doctor could identify the issue correctly (totally different frustrating story), I would not be having the issues 133 days later since the initial onset. I just don't want this employer to get away with doing something that as a CPA he should've know NOT to do in the first place. Adding it up, he would've had to pay so little in taxes, FICA etc and I was part time in a very small office so no benefits would've been required, so I really don't understand why he felt it was alright to misclassify me. It's a pain to have to refile my taxes, submit additional documents and waste time.

    I'm hoping this is a little clearer, and I do apologize for Supreme vs Superior. I just watched this man mismanage retirement plans (separate issue, but goes to relevance of character) and get away with it, I don't want to see him get away with this too which is why I am willing to do whatever is needed to ensure he can not continue to get away with it.

  10. #10
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    Default Re: Misclassified Independent Contractor Denied Unemployment for Tardiness

    Quote Quoting Irishred111
    View Post
    The Board of Review claimed that I did not have sufficient reasoning for filing the claim late and they reversed the referee's decision and also wrote "The claimant's appeal to the referee is dismissed for lack of jurisdiction." How is that possible? How can the referee have lack of jurisdiction?

    I then received a second letter stating that they reviewed the tape from the hearing, which why they didn't do so in the first place is beyond me. The reasoning was the same, but the jurisdiction thing is baffling to me. But in NEITHER of the letters that the Board of Review sent did they mention anything about the misclassification.
    Of all that you wrote, this is the meat of why you aren't getting benefits.

    You were denied initially.

    The ALJ found good cause for late filing your appeal and awarded benefits.

    By the board saying you didn't have good cause to be late with your appeal, then the ALJ hearing should have never happened in the first place, and the initial decision takes affect again. That means the denial is put back in place.

    Had your appeal submission been on time or late for good cause then the ALJ would have had jurisdicition. By the board saying that you didn't have good cause, then the ALJ couldn't take jurisdiction and the hearing should have never happened, never got into the tardiness issues, never should have produced a decision in your favor. It's as though it never happened.

    If you're going to proceed in the appeals process, that is the only thing you need to get changed. Have the ALJ's decision regarding the late filing reinstated.

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