Unemployment Insurance - Worker Classification

Truckers (Motor Carriers and Contract Operators)

Part 2: Independently Established Trade, Business, or Profession

Wis. Admin. Code § DWD 105 (Relationships of Carriers and Contract Operators) determines whether or not a trucker who is a contract operator for a licensed motor carrier is an employee for the purposes of unemployment insurance. (See Wis. Admin. Code § DWD 100.02 for the definitions of "carrier" and "contract operator" and Wis. Stat. § 108.02 (25e) for the definition of "trucker".)

According to Wis. Admin. Code § DWD 105, an employer must examine the following three factors to determine whether the trucker/contract operator is performing services in an independent business in which the trucker/contract operator is customarily engaged:

1. The contract operator owns the motor vehicle or holds the motor vehicle under a bona fide lease arrangement with any person other than the employer.
2. The contract operator is free to hire another person as a driver in the performance of services for the employer.
3. The contract operator is free to reject hauling a load offered by the employer.

If these three factors are present, the contract operator will be found by the department to be performing services in an independently established business in which the contract operator is customarily engaged.

If one or more of the three factors above are not present in the relationship between the employer and the contract operator, the employer will have to consider the following three additional factors:

1. The contract operator's business may provide a means of livelihood that is separate and apart from the livelihood gained from the services performed for a particular carrier.
2. The business would continue if the relationship with the employer was terminated.
3. The contract operator has an ownership interest in a business that the contract operator alone may sell or give away without restriction from the employer.

Under the law, the three factors are considered, but no one factor or particular combination of factors controls the determination of whether the contract operator is performing services in an independent business in which the contract operator is customarily engaged.

If the contract operator is not performing services in an independent business in which the contract operator is customarily engaged, the contract operator is an employee for the purposes of unemployment insurance.

If, after applying the above test, the contract operator is found to be performing services in an independent business in which the contract operator is customarily engaged and the contract operator is found to be free of the employer's direction and control, the contract operator is an independent contractor and not an employee.