E-Z Movers, Inc. v. Rowell
2016 IL App (1st) 150435
| Ill. App. Ct. | 2016Background
- E-Z Movers classified 92 drivers and helpers as independent contractors (1099s) for 2007–2008; IDES audited after an unemployment claim and assessed $25,014.70 in contributions, treating them as employees.
- The company owned and provided the moving trucks bearing its logo; workers supplied minor tools (gloves, boots) and were paid a share of customer hourly charges; E‑Z Movers procured customers, set prices, billed clients, and paid the workers.
- E‑Z Movers used written "independent contractor" agreements requiring contractors to procure insurance and perform assigned jobs "professionally," but those agreements also limited use of trucks and required performance of assigned jobs.
- The Director’s representative found the workers were employees under §212 of the Unemployment Insurance Act (820 ILCS 405/212 (West 2006)) and the Director adopted that decision; the Cook County circuit court reversed on administrative review.
- The Appellate Court reviewed the Director’s decision under the clearly erroneous standard (mixed question of law and fact) and reversed the circuit court, reinstating the Director’s determination that the workers were employees.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether workers were free from E‑Z Movers’ control (§212(A)) | Drivers/helpers set schedules, could refuse jobs, determined methods, paid some expenses — so no control | Company hired/fired, provided trucks, scheduled jobs, limited truck use, contracts obligated performance — so control existed | Held for Defendant: sufficient evidence of control; §212(A) not satisfied by E‑Z Movers |
| Whether services were outside E‑Z Movers’ usual course of business (§212(B)) | Workers did physical moving while E‑Z Movers did marketing/clients — physical work is separate from company’s core business | A moving company’s business requires movers; uniforms and company trucks represent the business — services are within usual course | Held for Defendant: services were within usual course; §212(B) not satisfied |
| Whether workers had independently established businesses (§212(C)) | Workers could work for others and bore some expense, indicating independent business status | Workers lacked trucks, licenses, customers, pricing control, and were economically dependent on E‑Z Movers | Held for Defendant: workers not independently established; §212(C) not satisfied |
Key Cases Cited
- AFM Messenger Service, Inc. v. Department of Employment Security, 198 Ill. 2d 380 (Illinois 2001) (§212 is conjunctive; mixed question of law and fact; focus on economic independence)
- Carpetland U.S.A., Inc. v. Illinois Department of Employment Security, 201 Ill. 2d 351 (Illinois 2002) (use totality of circumstances and Administrative Code factors to assess control)
- Jack Bradley, Inc. v. Department of Employment Security, 146 Ill. 2d 61 (Illinois 1991) (independence requires ability to operate apart from the contracting entity)
- SMRJ, Inc. v. Russell, 378 Ill. App. 3d 563 (Ill. App. 2007) (lists factors for §212(C) entrepreneurial/business independence)