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KEN FRIEDMAN v. COMMONWEALTH PENNSYLVANIA (07/31/86)

decided: July 31, 1986.

KEN FRIEDMAN, PETITIONER
v.
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 Ken Friedman, No. B-216617.

COUNSEL

David L. Narkiewicz, Rosenstein & Romano, P.C., for petitioner.

Richard F. Faux, Associate Counsel, with him, Charles G. Hasson, Acting Deputy Chief Counsel, for respondent.

President Judge Crumlish, Jr., Judge Colins, and Senior Judge Blatt, sitting as a panel of three. Opinion by President Judge Crumlish, Jr.

Author: Crumlish

[ 99 Pa. Commw. Page 370]

Ken Friedman appeals an Unemployment Compensation Board of Review order upholding a referee's decision which denied him benefits due to self-employment. Section 402(h) of the Unemployment Compensation Law.*fn1 We reverse.

Friedman, a twenty percent stockholder and vice-president of Wallcoverings, Ltd. (Wallcoverings), was discharged from his position as store manager. The referee found that Friedman exercised substantial control over the day-to-day operations of Wallcoverings and was

[ 99 Pa. Commw. Page 371]

    therefore self-employed and ineligible for benefits pursuant to Starinieri Unemployment Compensation Case, 447 Pa. 256, 289 A.2d 726 (1972).

Whether a person is self-employed is a question of law subject to our review. In Starinieri, our Supreme Court held that a claimant will be deemed self-employed where, through his stock ownership and position in the corporation, he exercises substantial control over the corporation. The type of control required is control over the management and policies of the corporation as a whole. Anello v. Unemployment Compensation Board of Review, 48 Pa. Commonwealth Ct. 25, 408 A.2d 1171 (1979). This determination is based upon the facts of each case. Geever v. Unemployment Compensation Board of Review, 65 Pa. Commonwealth Ct. 491, 442 A.2d 1227 (1982). Friedman contends that the facts here do not support a conclusion that he was self-employed. We agree.

Wallcoverings consists of two stockholders. Eighty percent of the stock is held by the president. Friedman, who was vice-president, owns the remaining twenty percent of the stock.*fn2 Friedman was general manager of Wallcoverings' retail store. His duties included ordering inventory and materials, supervising other employees and hiring and firing employees. He could not set employee salaries, but merely made recommendations to the president. He was not authorized to sign checks on behalf of the corporation. Any decisions he made were subject to the veto power of the president. Moreover,

[ 99 Pa. Commw. Page 372]

    the board of directors, which decided to discharge Friedman, was elected by the president in his ...


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