Agat Transport, Inc. v. Employment Department, 305 P.3d 122

AGAT seeks review of a final ALJ order affirming a department unemployment tax assessment.
ALJ held PPC drivers were AGAT’s employees, not independent contractors, making their pay subject to unemployment tax.
Kotlyarenko’s compensation was contested as exempt under ORS 657.047(1)(b) because he allegedly leased a vehicle to AGAT.
AGAT’s PPC contracts allowed drivers to accept jobs, hire helpers with AGAT’s approval, and required dispatch contact and signage; most drivers leased trucks from AGAT under a lease-to-own structure.
Lease arrangements were integrated with PPC contracts, ending upon PPC termination with AGAT retaining the truck; ownership/control issues central to whether drivers were independent contractors.
On review, the court remanded to reconsider Kotlyarenko’s exempt status and affirmed the core finding that PPC drivers (except Kotlyarenko) were not independent contractors.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Are PPC drivers employees or independent contractors?	AGAT argues drivers are independent contractors.	Department argues drivers are employees; evidence shows direction and control.	PPC drivers are employees.
Whether Kotlyarenko’s pay was exempt as lessor under ORS 657.047(1)(b)?	AGAT contends Kotlyarenko leased a vehicle to AGAT, making him the lessor; exemption applies.	Record insufficient or not admitted; needs remand to address status.	Remanded to reconsider Kotlyarenko exemption on the evidentiary record.

Avanti Press v. Employment Dept. Tax Section, 248 Or App 450 (2012) (direction-and-control test involves legal interpretation of control over means and manner)
3P Delivery, Inc. v. Employment Dept. Tax Section, 254 Or App 180 (2012) (employee vs independent contractor; for-hire carrier exemptions analysis)
Schaff v. Ray's Land & Sea Food Co., Inc., 334 Or 94 (2002) (employee vs independent contractor is a question of law when arrangement undisputed)