Briefs filed in Builders Commonwealth, Inc., Relator, vs. Department of Employment and Economic Development, Respondent.

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Minnesota Appellate Court Issues in Briefs

Shown here are the statements of the issues presented for review by the appellate courts in the briefs filed for this case. The entire brief set can be found at the State Law Library and other libraries around the state. See Minnesota Appellate Court Briefs Collection for more information.

CASE NAME:  Builders Commonwealth, Inc., Relator, vs. Department of Employment and Economic Development, Respondent.
        Read the opinion in this case at A11-1307
        CITATION: 814 N.W.2d 49 (Minn. Ct. App. 2012)

  • Did the Unemployment Law Judge err in concluding that all members of the ยท worker cooperative, Builders Commonwealth ("Builders"), are construction workers and employees of Builders, pursuant to Minnesota Statutes Sections 268.035, subdivision 9a, and 181.723, and that Builders is an employer pursuant to Minnesota Unemployment Insurance Law effective January 11 2006? In the appeal to the Department of Employment and Economic Development ("DEED"), the issue was whether the workers are employees or independent contractors or members of a cooperative which are not considered employees for purposes of the Minnesota unemployment insurance law. (T.26, App-106) The principal arguments raised in the appeal to DEED were the following: a) advances paid to Builders' members, which are expressly designated as "loans" that members are contractually obligated to pay back (and have been required to pay back for the last four years), and which are designated as loans on the cooperative's books at the time of payment, are not "wages" pursuant to Minn. Stat. §268.035, subd. 29 (e); b) as a bonafide cooperative, the members of Builders are neither employees nor independent contractors as contemplated by Minn. Stat. §181.723, subds. 3 and 4; and c) DEED is precluded from re-litigating Builders' status by a 1991 decsion in which the Department of Jobs and Training (DEED's predecessor) concluded that the "remuneration" (advances) paid to members was not wages and that Builders was not an employer. Unemployment Law Judge Richard Croft concluded that members of Builders are employees of Builders and that Builders is an employer pursuant to Minnesota Unemployment Insurance Law. Builders requested reconsideration of the decision pursuant to Minnesota Statutes Section 268.105. The most apposite cases and statutory provisions are the following: Nelson v. Leyy, 796 N.W.2d 336 (Minn. App. 2011). Goldberg v. Whitaker House Co-op, Inc., 366 U.S. 28 (1961). Blue & White Taxi v. Carlson, 496 N.W.2d 826 (Minn. App. 1993). Rucker v. Schmidt, 794 N.W.2d 114 (Minn. 2011). Minn. Stat. §268.635, subd. 29(e). "Wages includes advances or draws against future earnings, when paid, unless the payments are designated as a loan or return of capital on the books of the employer at the time of payment." Minn. Stat. §181.723, subds. 3 and 4.
  • Minnesota law lays out the test for determining whether, for purposes of unemployment insurance, an individual performed building construction or improvement services in employment or as an independent contractor. The law provides that such individuals are employees, unless they obtain an independent contractor certificate. Builders Commonwealth, Inc. is a workers cooperative comprised of approximately 30 member workers, all of whom perform building construction or improvement services. None have obtained independent contractor certificates. Are these members employees of Builders Commonwealth? Unemployment Law Judge ("ULJ") Richard Croft found that these individuals are performing services in employment under the Minnesota Unemployment Insurance Law, and have been since January of 2006.

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