New York Shareholder Ted Eder Wins New York State Appellate Division Reversal for a Delivery Company on Independent Contractor Basis 


March 2, 2015

Segal McCambridge New York Shareholder Ted Eder achieved a reversal from the New York State Appellate Division, Third Department for a delivery services company, American Delivery Solutions (ADS) of an administrative ruling that ADS was liable for unemployment insurance contributions.  The Third Department reversed the Unemployment Insurance Board’s ruling in a decision filed on February 19, 2015 finding that the claimant was an independent contractor.

The individual claimant provided contract delivery services for ADS, a business that sends lost luggage from airports to its owners. After his alleged employment ended, the claimant applied for and was granted unemployment insurance benefits.  ADS objected, saying that the claimant was an independent contractor because he paid all expenses associated with his delivery work, including the costs of leasing and maintaining his vehicle, fuel, tolls, insurance, maintenance and cell phone.  He was also not trained, nor did ADS impose any conditions over how he performed his job.  He was allowed to hire others to perform work, did not work a fixed schedule, and had the right to accept or reject assignments and perform work for any other company.  The Board found claimant to be an employee.

The Appellate Division, in a rare reversal of a Board Panel decision, held that the Board abused its discretion because of the lack of evidence that ADS exercised sufficient control over the claimant to establish an employer-employee relationship. The reversal is an important win for the courier and messenger industry on independent contractors. Read the full decision here.

Ted Eder is trial counsel for various corporate clients, including auto manufacturers, trucking companies, industrial equipment corporations, contractors and property owners throughout New York and New Jersey. He has successfully defended these companies in products liability, construction accident, property damage, consumer fraud, workers compensation, employment, wage and hour and commercial litigation lawsuits in both State and Federal Court.