Submitted: June 28, 2013
BEFORE: HONORABLE BERNARD L. McGINLEY, Judge, HONORABLE ROBERT SIMPSON, Judge HONORABLE JAMES GARDNER COLINS, Senior Judge
JAMES GARDNER COLINS, Senior Judge
Cathy Stauffer (Petitioner), an individual who does not operate a business, petitions for review of a decision and order of the Unemployment Compensation Board of Review (Board) holding that she was an employer of Dana C. Cramer (Claimant), whom she paid to provide child care when she was at work, and that Claimant was therefore not ineligible for unemployment compensation benefits under Section 402(h) of the Unemployment Compensation Law (the Law). The only issue before us is whether Petitioner was an employer, as the Board also ruled that Claimant is ineligible for benefits under Section 402(b) of the Law because she voluntarily quit work without a necessitous and compelling reason and Claimant has not appealed that ineligibility ruling. For the reasons that follow, we reverse the Board's ruling that Petitioner was Claimant's employer.
Petitioner is a mother of three children who works for employers outside the home. (Record Item (R. Item) 16, Board Decision and Order, Findings of Fact (Board F.F.) ¶2, Reproduced Record (R.R.) at 86; R. Item 9, Transcript of Testimony from Referee's August 23, 2012 Hearing (8/23/12 H.T.) at 6, 12, R.R. at 30, 36.) Two of Petitioner's children have special needs. (R. Item 16, Board F.F. ¶2, R.R. at 86; R. Item 9, 8/23/12 H.T. at 6, R.R. at 30.) Claimant, age 21, had previously worked babysitting Petitioner's children for ten years on a casual basis. (R. Item 16, Board F.F. ¶3, R.R. at 86; R. Item 9, 8/23/12 H.T. at 13, R.R. at 37.) In 2010, Petitioner and Claimant agreed that Claimant would provide more of the babysitting that Petitioner needed. (R. Item 16, Board F.F. ¶5, R.R. at 86; R. Item 9, 8/23/12 H.T. at 5-6, 11, R.R. at 29-30.) Claimant, however, was not the only person providing child care to Petitioner, and five or six other babysitters, including Claimant's mother, also watched Petitioner's children. (R. Item 9, 8/23/12 H.T. at 7, 11, 14, R.R. at 31, 35, 38.) Petitioner and Claimant did not enter into any written agreement governing Claimant's work. (Id. at 7, 14, R.R. at 31, 38.)
Petitioner paid Claimant $10 per hour for child care or a flat $75 fee for overnight work. (R. Item 16, Board F.F. ¶1, R.R. at 86; R. Item 9, 8/23/12 H.T. at 5, 7, 10, R.R. at 29, 31, 34.) Claimant gave Petitioner handwritten invoices for the hours she worked. (R. Item 9, 8/23/12 H.T. at 7-8, 10, 14, R.R. at 31-32, 34, 38.) The documents submitted by Claimant in support of her claim for benefits show that in 2011, the base year at issue in this case, Petitioner paid Claimant a total of $10, 345 and that these payments were made throughout the year in variable amounts, with more than half of the payments in amounts of $220 or less per week. (R. Item 2, Claimant Financial Information, R.R. at 5-6, 9.) Claimant reported this income on her federal and state taxes as profit from operation of a child care business and deducted over $2, 000 for her car and telephone as expenses of that business. (Id., R.R. at 9-10, 16.) Claimant also had some part-time employment in 2011for at least part of the year in addition to her child care for Petitioner, and she reported that other income as wages from employment. (Id., R.R. at 3, 7, 13, 15; R. Item 9, 8/23/12 H.T. at 11, R.R. at 35.) Petitioner did not withhold income taxes from her payments to Claimant or provide a W-2 Form or a Form 1099 to Claimant, but reported the payments and identified her child care providers on her own tax forms. (R. Item 9, 8/23/12 H.T. at 6, 11, 13-15, 17-18, R.R. at 30, 35, 37-39, 41-42.)
In April 2012, Claimant decided to stop providing child care for Petitioner to accept a job with a printing and finishing company that she knew was subject to frequent layoffs for insufficient work. (R. Item 9, 8/23/12 H.T. at 9, 19, R.R. at 33, 43; R. Item 15, Transcript of Testimony from Referee's November 7, 2012Hearing (11/7/12 H.T.) at 3-4, R.R. at 81-82.) On May 31, 2012, Claimant filed for unemployment benefits. On July 13, 2012, the Unemployment Compensation Service Center found that Claimant was not an independent contractor with respect to the child care that she provided for Petitioner and that Claimant was therefore not ineligible under Section 402(h) of the Law. (R. Item 5, Notice of Determination.) The Service Center on the same date issued a separate determination that Claimant was not ineligible under Section 402(b) of the Law for having voluntarily quit her work for Petitioner. (Supplemental Record Item (Supp. R. Item) 4, Notice of Determination in B-12-09-F-7632.) Petitioner timely appealed from both of these determinations.
On August 23, 2012, the Referee held a hearing on both the issue of whether Claimant was self-employed and the voluntary quit issue at which Petitioner, Claimant and Claimant's mother testified. Petitioner testified that when Claimant's child care for her "first started, it was more random. If I needed to run an errand, Dana [Claimant] would stay with the children and I would pay her for that. And then I think later in 2010 she was asking for more hours. … [S]he was watching the children while I was working sometimes, and then she was asking for more hours." (R. Item 9, 8/23/12 H.T. at 6, R.R. at 30.) Petitioner testified that Claimant chose which hours she worked from the hours that Petitioner needed child care and that Claimant was free both to reject assignments and to babysit for other families:
[Petitioner's Representative]: Who determined what hours Dana Cramer [Claimant] would offer services?
[Petitioner]: I made a list of hours I needed every week, and then Dana got to choose what hours she chose to work for those, what suited her to work that week.
[Petitioner's Representative]: Was Dana the only person providing childcare for you?
[Petitioner's Representative]: So on the hours that Dana didn't select, how would you go about distributing that?
[Petitioner]: I would offer them to the other babysitters who watched my children.
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[Petitioner's Representative]: Okay. Did you ever restrict her from babysitting for anyone else?
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[Petitioner's Representative]: Was she able to adjust her schedule ...