Can a technician prove employee status based on degree of supervisory control?

Is a cable television and Internet technician an employee or independent contractor?

By Christina Lumbreras

A cable company contracted with a business to install cable television and Internet service for customers. The business owner entered into an agreement with a cable installation technician. The business provided the technician with tax forms for independent contractors and informed him that he was hired as a subcontractor. The technician obtained workers' compensation insurance as required by the business, but it was a "ghost" policy that excluded him from coverage.

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Before the technician could work independently, he had to train with a supervisor for three weeks. The technician fell and injured his left foot while performing installation work. The parties agreed that the injury would be compensable if the technician was an employee of the business.

The technician was paid a percentage of the fee negotiated by the cable company and the business. He did not negotiate the terms of his job assignments. The company required him to drive a particular type of vehicle with a sign advertising the business and wear a uniform displaying the business's name. It also required him to use a specific set of tools. He did not have one particular tool, so the business provided it to him and deducted the cost from his pay. He was required to report to the business's office each day to turn in paperwork and pick up his assignments. The job assignment schedule depended on what assignments the cable company sent to the business. He was expected to work six days a week at jobs assigned by the business and had to complete each job within a two-hour time period. He was required to notify the cable company when he finished an assignment. The business accessed a computer program that monitored the technician's progress during the day. The technician was a part of a team and he reported to a supervisor.

The Industrial Commission found that the technician was an independent contractor and not entitled to benefits. The technician appealed.

Was the commission correct in finding the technician was not an employee?

A. No. The technician's work schedule and the manner in which he performed his work were controlled by the business.

B. Yes. The technician was hired as an independent contractor rather than an employee.

C. Yes. The technician obtained his own workers' compensation insurance policy when he was hired.

How the court ruled: A. The North Carolina Court of Appeals held that the technician was an employee and not an independent contractor. Capps v. Southeastern Cable, No. COA10-505 (N.C. Ct. App. 08/02/11).

The court considered numerous factors to determine whether the business retained the right of control over the technician. The court found that the business exerted "significant control" over the technician's working hours. The business asserted supervisory authority over him. Also, the vehicle and uniform requirements conveyed an impression that he was employed by the business.

B is incorrect. The court explained that the evidence showed the manner in which the business wished to have the employment relationship characterized. This was not binding on the court.

C is incorrect. The court explained that although the technician procured insurance at the business's insistence, this did not mean he could not receive benefits.

Editor's note: This column is not intended as instructional material or to replace legal advice.

September 29, 2011

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