decided: March 20, 1980.
EILEEN S. CRENSHAW, PETITIONER
COMMONWEALTH OF PENNSYLVANIA, UNEMPLOYMENT COMPENSATION BOARD OF REVIEW, RESPONDENT
Appeal from the Order of the Unemployment Compensation Board of Review in case of In Re: Claim of Eileen S. Crenshaw, No. B-167404.
Jerome Balter, for appellant.
John T. Kupchinsky, Assistant Attorney General, with him Richard Wagner, Chief Counsel and Edward G. Biester, Jr., Attorney General, for respondent.
Judges Blatt, MacPhail and Williams, Jr., sitting as a panel of three. Opinion by Judge MacPhail. President Judge Bowman did not participate in the decision in this case. Judge Williams, Jr. concurs in result only.
[ 50 Pa. Commw. Page 137]
Eileen Crenshaw (Claimant) was last associated with the University of Pennsylvania (University) as an industrial hygiene consultant on June 30, 1978.
[ 50 Pa. Commw. Page 138]
Following written notification that she was being relieved of her duties as a consultant, she applied for unemployment compensation benefits. The Bureau (now Office) of Employment Security (Bureau) denied benefits on the basis that she was self-employed and, therefore, ineligible for benefits pursuant to Section 402(h) of the Unemployment Compensation Law (Law), Act of December 5, 1936, Second Ex. Sess. P.L.  2897, as amended, 43 P.S. § 802(h). Upon appeal and after hearing, the referee affirmed the Bureau's determination on the basis of Section 402(h). The referee did not address Claimant's alternative argument that even if she were self-employed during her association with the University, she was eligible for benefits pursuant to Section 401(f) of the Law, 43 P.S. § 801(f).*fn1 Upon further appeal, the Unemployment Compensation Board of Review (Board) affirmed the referee's decision on the basis of Section 402(h) and held Section 401(f) to be inapplicable to this case.
Claimant appeals to us from the Board's order and raises two issues: whether the Board's determination
[ 50 Pa. Commw. Page 139]
that she was self-employed was supported by substantial evidence and whether, even if she had been self-employed, she nevertheless is eligible for unemployment compensation benefits pursuant to Section 401(f). For the reasons which follow, we reverse the order of the Board and remand this case for a computation of benefits.
Section 4(1) of the Law, 43 P.S. § 753(1) defines "Employment" as
(1) . . . all personal service performed for remuneration by an individual under any contract of hire, express or implied, written or oral, . . . .
[(2)(B)] Services performed by an individual for wages shall be deemed to be employment subject to this act, unless and until it is shown to the satisfaction of the department that -- (a) such individual has been and will continue to be free from control or direction over the performance of such services both under his contract of service and in fact; and (b) as to such services such individual is customarily engaged in an independently established trade, occupation, profession or business.
This Court has repeatedly held that before a claimant will be declared to have been self-employed, the employer bears the burden of proving both elements of Section 4(1)(2)(B). Kardon v. Unemployment Compensation Board of Review, 40 Pa. Commonwealth Ct. 20, 21, 396 A.2d 487, 488 (1979); Jochynek v. Unemployment Compensation Board of Review, 32 Pa. Commonwealth Ct. 86, 89, 378 A.2d 490, 491 (1977); American Diversified Corp. v. Bureau of Employment Security, 1 Pa. Commonwealth Ct. 527, 529, 275 A.2d 423,
[ 50 Pa. Commw. Page 140425]
(1971). The question before us is whether there is substantial evidence, that is, such relevant evidence as a reasonable mind might accept as adequate to support a conclusion, Fenk v. Unemployment Compensation Board of Review, 45 Pa. Commonwealth Ct. 213, 216, 405 A.2d 590, 591 (1979), to support both elements and the resultant conclusion that Claimant was self-employed. We hold that there was not.
In support of its conclusion, the Board made findings of fact as follows:
1. The claimant was last associated with the University of Pennsylvania on June 30, 1978 as an Industrial Hygiene Consultant for which she received a per diem fee of $100.00 plus traveling expenses.
2. The claimant conducted research at an industrial plant.
3. The claimant worked three days per week and set her working hours as she deemed necessary to properly conduct her research.
4. The claimant was not under the direct supervision of the University, but submitted periodic progress reports to an associate professor in charge of the study.
5. No tax deductions were made by the University from the claimant's fees.
6. The claimant was not covered under the fringe benefit programs provided by the University to its employes.
7. The claimant accepted the association with the understanding that the study would last a minimum of five months, with the possibility of a longer association should the study director find her work satisfactory.
Although all of the findings are supported by evidence on the record, findings 1 and 2 are irrelevant to
[ 50 Pa. Commw. Page 141]
the issue of self-employment,*fn2 findings 3, 4, 5, and 6 are not enough to support a conclusion of self-employment, and finding 7 is contrary to a finding of self-employment. Findings 3 through 7 all go to the element of control. In considering that element, as set forth in Section 4(1)(2)(B), we must remember that "[O]ne need not actually exercise control in order to be considered an employer; rather, the mere right or authority to exercise control or interfere with the work creates an employment relationship." Biter v. Department of Labor and Industry, 39 Pa. Commonwealth Ct. 391, 395, 395 A.2d 669, 670 (1978). We hold that on the facts of this case, the University did control Claimant's employment.
First, the fact that Claimant's working hours were flexible does not indicate a lack of control by the University. She testified that she was not free to work whenever and wherever she wanted without limit, but that she had to work at the industrial plant when it was convenient to interact with plant employees crucial to the University's studies.*fn3 Second, this Court
[ 50 Pa. Commw. Page 142]
has found that the failure to withhold taxes is not controlling on the issue of self-employment. National Freight, Inc. v. Unemployment Compensation Board of Review, 34 Pa. Commonwealth Ct. 161, 164-65, 382 A.2d 1288, 1290 (1978). We hold the same principle to be applicable to fringe benefits. Furthermore, we conclude, as a matter of law, that claimant's periodic progress reports to the associate professor in charge of the study (Dr. Mack) establish that he, and through him, the University*fn4 controlled her work. Finally, as indicated by finding 7, Dr. Mack controlled the tenure of Claimant's position and he was the person who actually relieved her of her duties on June 30, 1978.
The University failed, then, to prove the first essential element of the self-employment test set forth in Section 4(1)(2)(B) of the Law. While we need not
[ 50 Pa. Commw. Page 143]
address the second element -- whether Claimant was customarily engaged in an independently established trade, occupation, profession or business -- we note that the record fails to support that requirement, as well. We also note that neither the referee nor the Board made any findings of fact concerning the second element.
Although our decision that Claimant is not ineligible to receive unemployment compensation benefits pursuant to Section 402(h) of the Law eliminates the need for us to address her alternative argument, the Board's brief on the issue compels us to do so. Claimant argued that if we found her to be self-employed while she was associated with the University, we should still find her to be eligible for benefits on the basis of Section 401(f). The Board does not contend that Claimant has not earned six times her benefits. Rather, the Board argues that Section 401(f) is inapplicable because she had no employment subsequent to her work with the University to purge her ineligibility. The Board has missed the point. Claimant contends that her work with the University purges her prior ineligibility for benefits caused by her voluntarily leaving her position with the Occupational Safety and Health Administration.*fn5 Claimant is correct and had we not already determined her to be eligible for benefits, we would do so on the basis of Section 401(f). Steinberg v. Unemployment Compensation Board of Review, 34 Pa. Commonwealth Ct. 294, 383 A.2d 1284 (1978).
[ 50 Pa. Commw. Page 144]
The Board's order is reversed and this case is remanded for a determination of benefits due Claimant.
And Now, this 20th day of March, 1980, the Order of the Unemployment Compensation Board of Review at No. B-167404, dated December 26, 1978, is reversed and the case is remanded for a determination of benefits due Petitioner.
President Judge Bowman did not participate in the decision in this case.
Judge Williams, Jr. concurs in result only.
Reversed and remanded.