I usually blog about New Jersey unemployment cases and determinations but there is an interesting case that was just decided in New York that is worth noting. Although the legal standard for entitlement to unemployment benefits differs between the states, both New Jersey and New York ultimately look to see how much “control” the business exercises over the worker in making its determination on how the relationship should be classified. The more control a business has over the worker in the nature and manner of the work performed, the more likely it is that he or she will be considered an employee who is entitled to unemployment benefits.
In the New York case, Yoga Vida NYC, Inc. v. Commissioner of Labor, No. 130 (N.Y. Oct. 25, 2016), the New York State Court of Appeals issued a rare decision, concluding that the employer yoga studio did not exercise sufficient control over certain of its instructors to create an employment relationship, thereby disqualifying the workers for unemployment compensation benefits.
Yoga Vida, a Manhattan-based yoga studio, offers classes taught by both staff instructors, classified as employees, and non-staff instructors, classified as independent contractors. The NYS Unemployment Insurance Appeal Board held that the non-staff instructors were misclassified as independent contractors and that Yoga Vida was therefore responsible for paying additional unemployment contributions. Yoga Vida appealed to the Appellate Division, which affirmed the determination of the Appeal Board. The NYS Court of Appeals reversed, finding that the non-staff instructors were not employees because Yoga Vida did not exercise sufficient control “over the results produced and the means used to achieve the results.”