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Berlin v Northwestern National Life Insurance 17.04

Section 43(h)

EMPLOYEE STATUS, Excluded employment, Insurance agent

CITE AS: Berlin v Northwestern National Life Insurance Co., No. 77624 (Mich App February 26, 1986).

Appeal pending: No

Claimant: Steven Berlin

Employer: Northwestern National Life Insurance Company

Docket No: B81 14302 80900

COURT OF APPEALS HOLDING: Claimant was not an independent contractor under the "economic reality" test enunciated in Powell v ESC, 345 Mich 455 (1956).

FACTS: Claimant worked full-time for employer as an insurance agent and was paid $1600/mo. Social Security tax was withheld. Commissions generated by claimant amounted to $351.23, while he received total compensation in excess of $8000. Claimant worked exclusively for employer and reported to supervisors daily. He was provided with an office, secretarial help, computer, supplies, and training.

DECISION: Claimant was not in excluded employment under the MES Act.

RATIONALE: Employer provided extensive services and training. Claimant represented himself solely as employer's agent and employer exercised a significant amount of control over claimant's day-to-day activities. Claimant's work was an integral part of employer's business. Claimant was an employee under the "economic reality" test. The court distinguished this case from Farrell v Auto Club of America, 148 Mich App 165 (1986). "Here, claimant was apparently being paid by respondent at a steady rate during the development or probationary period. His income does not appear to have fluctuated according to the number of units he was able to sell."


10, 15:D

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