50-7-207 -
50-7-207. Employment and related definitions.
(a) Definition of Employment. For purposes of this chapter and subject to the special rules contained in subsection (e), and the definitions contained in subsection (f), employment means service that meets all of the following conditions:
(1) It is within any category of included service as listed in subsection (b);
(2) It is not within any category of excluded service as listed in subsection (c); and
(3) It is within any category of Tennessee service as listed in subsection (d).
(b) Included Service. For purposes of this section, included service means any of the following:
(1) Service performed prior to January 1, 1978, that was employment as defined in this section prior to January 1, 1978;
(2) Subject to the other provisions of this section, service performed after December 31, 1977, including service in interstate commerce, by:
(A) Any officer of a corporation;
(B) Any individual who, under the usual common-law rules applicable in determining the employer/employee relationship, has the status of an employee; and
(C) Any individual other than an individual described in subdivision (b)(2)(A) or (B) who performs services for remuneration for any person:
(i) In either of the following capacities:
(a) As an agent driver or commission driver engaged in distributing meat products, vegetable products, fruit products, bakery products, beverages other than milk, or laundry or dry-cleaning service, for the driver's principal; or
(b) As a traveling or city salesperson, other than as an agent driver or commission driver, engaged on a full-time basis in the solicitation on behalf of, and the transmission to, the salesperson's principal, except for side-line sales activities on behalf of some other person, of orders from wholesalers, retailers, contractors, or operators of hotels, restaurants, or other similar establishments for merchandise for resale or supplies for use in their business operations; and
(ii) In the presence of all of the following conditions:
(a) The contract of service contemplates that substantially all of the services are to be performed personally by the individual;
(b) The individual does not have a substantial investment in facilities used in connection with the performance of services other than in facilities for transportation; and
(c) The services are not in the nature of a single transaction that is not part of a continuing relationship with the person for whom the services are performed;
(3) Except as provided in subdivision (c)(5), service performed by an individual:
(A) After December 31, 1971 and prior to January 1, 1978, in the employ of this state or any of its instrumentalities, or in the employ of this state and one (1) or more other states or their instrumentalities, for a hospital or institution of higher education located in this state; provided, that the service is excluded from employment as defined in the federal Unemployment Tax Act, 26 U.S.C. § 3306(c)(7), and does not constitute excluded employment under subdivision (c)(5); and
(B) After December 31, 1977, in the employ of this state or any of its instrumentalities or any political subdivision of the state or any of its instrumentalities or any instrumentality of more than one (1) of the foregoing or any instrumentality of any of the foregoing and one (1) or more other states or political subdivisions; provided, that the service is excluded from employment as defined in the federal Unemployment Tax Act, 26 U.S.C. § 3306(c)(7), and does not constitute excluded employment under subdivision (c)(5);
(4) Except as provided in subdivision (c)(5), service performed by an individual after December 31, 1977, in the employ of a religious, charitable, educational or other organization, but only if both of the following conditions are met:
(A) The service is excluded from employment as defined in the federal Unemployment Tax Act, 26 U.S.C. § 3306(c)(8); and
(B) The organization had four (4) or more individuals in employment for some portion of a day in each of twenty (20) different weeks, whether or not the weeks were consecutive, within either the current or preceding calendar year, regardless of whether they were employed at the same point in time;
(5) Service performed after December 31, 1971, by an officer or crew member of an American vessel or American aircraft or in connection with the American vessel or American aircraft; provided, that it meets the conditions of subdivision (d)(5);
(6) Notwithstanding subsection (c), service with respect to which a tax is required to be paid under any federal law imposing a tax against which credit may be taken for contributions required to be paid into a state unemployment fund or that as a condition for full credit against the tax imposed by the federal Unemployment Tax Act, compiled in 26 U.S.C. § 3301 et seq., is required to be covered by this chapter;
(7) Service performed after December 31, 1977, by an individual in agricultural labor as defined in subdivision (f)(1); provided, that:
(A) The service is performed for a person who either:
(i) During any calendar quarter in either the current or preceding calendar year paid remuneration in cash of twenty thousand dollars ($20,000) or more to individuals employed in agricultural labor, not taking into account service in agricultural labor performed before January 1, 1980, by an alien referred to in subdivision (b)(7)(B); or
(ii) For some portion of a day in each of twenty (20) different calendar weeks, whether or not the weeks were consecutive, in either the current or the preceding calendar year, employed in agricultural labor ten (10) or more individuals, regardless of whether they were employed at the same point in time, not taking into account service in agricultural labor performed before January 1, 1980, by an alien referred to in subdivision (b)(7)(B);
(B) For purposes of this section, any individual who is a crew member furnished by a crew leader to perform service in agricultural labor for any other person shall be treated as an employee of the crew leader, if both of the following conditions are met:
(i) Substantially all the members of the crew operate or maintain tractors, mechanized harvesting or cropdusting equipment or any other mechanized equipment, that is provided by the crew leader; and
(ii) The individual is not an employee of the other person within the meaning of subdivision (a)(2);
(C) For the purposes of this subdivision (b)(7), in the case of any individual who is furnished by a crew leader to perform service in agricultural labor for any other person and who is not treated as an employee of the crew leader under subdivision (b)(7)(B), the following shall apply:
(i) The other person and not the crew leader shall be treated as the employer of the individual; and
(ii) The other person shall be treated as having paid cash remuneration to the individual in any amount equal to the amount of cash remuneration paid to the individual by the crew leader, either on the person's own behalf or on behalf of the other person, for the service in agricultural labor performed for the other person;
(8) Domestic service performed after December 31, 1977, in a private home, local college club, or local chapter of a college fraternity or college sorority and performed for a person who paid cash remuneration of one thousand dollars ($1,000) or more after December 31, 1977, in any calendar quarter, to an individual or individuals employed in the domestic service in the current calendar year or the preceding calendar year;
(9) During the effective period of the election, service covered by an election pursuant to § 50-7-405 and service covered by an election duly approved by the administrator in accordance with an arrangement pursuant to § 50-7-405; or
(10) The entire service of an individual in the case of service that is not covered under this section and performed entirely without this state, with respect to no part of which contributions are required and paid under any unemployment compensation law of any other state or of the federal government; provided, that the individual performing the services is a resident of this state and the administrator approves the election of the employing unit for which the services are performed.
(c) Excluded Service. For purposes of this section, excluded service means any of the following, unless the employing unit for which the service is performed is liable for a federal tax on the remuneration paid for the service against which credit may be taken for premiums paid under this chapter, or unless the employing unit has elected that the service shall be deemed to constitute employment subject to this chapter pursuant to § 50-7-405, in which cases the service shall be included service as provided in subsection (b):
(1) Service performed in the employ of any other state or its political subdivisions, or of the United States government, or of an instrumentality of any other state or states or their political subdivisions or of the United States, except that after 1961, to the extent that the congress of the United States permits states to require any instrumentalities of the United States to make payments into an unemployment fund under a state employment security law, this chapter shall apply to those instrumentalities, and to service performed for the instrumentalities, in the same manner, to the same extent, and on the same terms as to all other employers, employing units, individuals, and service; provided, that, if this state is not certified for any year by the secretary of labor under the federal Unemployment Tax Act, 26 U.S.C. § 3304(c), the payments required of the instrumentalities with respect of that year shall be refunded by the commissioner for the fund in the same manner and within the same period as is provided in § 50-7-404(f) with respect to premiums erroneously collected;
(2) Service performed after June 30, 1939, with respect to which unemployment compensation is payable under the Railroad Unemployment Insurance Act of Congress, 52 Stat. 1094, compiled in 45 U.S.C. § 351 et seq., and services with respect to which unemployment benefits are payable under an unemployment compensation system for maritime employees established by an act of congress; provided, that the commissioner is authorized and directed to enter into agreements with the proper agencies under the act of congress, which agreements shall become effective in the manner provided in § 50-7-603, to provide reciprocal treatment to individuals who have, after acquiring potential rights to benefits under this chapter, acquired rights for unemployment compensation under the act of congress, or who have, after acquiring potential rights to unemployment compensation under the act of congress, acquired rights to benefits under this chapter;
(3) Except as provided in subsection (b), service performed by an individual in agricultural labor as defined in subdivision (f)(1);
(4) Service performed by an individual in the employ of the individual's son, daughter or spouse, and service performed by a child under eighteen (18) years of age in the employ of the child's father or mother;
(5) Notwithstanding subdivisions (b)(3) and (4), services performed:
(A) In the employ of a church, convention or association of churches;
(B) In the employ of an organization that is operated primarily for religious purposes and that is operated, supervised, controlled or principally supported by a church, convention or association of churches;
(C) By a duly ordained, commissioned or licensed minister of a church in the exercise of the minister's ministry or by a member of a religious order in the exercise of duties required by the religious order;
(D) After December 31, 1977, in the employ of a governmental entity referred to in subdivision (b)(3) if the service is performed by an individual in the exercise of duties:
(i) As an elected official;
(ii) As a member of a legislative body, or a member of the judiciary, of a state or political subdivision;
(iii) As a member of the state national guard or air national guard;
(iv) As an employee serving on a temporary basis in the case of fire, storm, snow, earthquake, flood or similar emergency; or
(v) In a position that, under or pursuant to the laws of this state, is designated as either:
(a) A major nontenured policymaker or advisory position; or
(b) A policymaking or advisory position the performance of the duties of which ordinarily does not require more than eight (8) hours per week;
(E) In a facility conducted for the purpose of carrying out a program of rehabilitation for individuals whose earning capacity is impaired by age or physical or mental deficiency or injury, or providing remunerative work for individuals who, because of their impaired physical or mental capacity, cannot be readily absorbed in the competitive labor market, by an individual receiving the rehabilitation or remunerative work;
(F) After December 31, 1977, in a custodial or penal institution by an inmate of the institution and, after June 30, 1999, by an inmate committed to a custodial or penal institution for any employer; or
(G) As part of an unemployment work-relief or work-training program assisted or financed in whole or in part by any federal agency or an agency of a state or political subdivision of a state, by an individual receiving the work-relief or work-training, unless otherwise required by the agency or by law governing the agency assisting or financing in whole or in part the unemployment work-relief or work-training program as a condition to the assistance or financing;
(6) Except to the extent set forth in subdivisions (b)(4) and (6), service performed in the employ of the corporation, community chest, fund or foundation, organized and operated exclusively for religious, charitable, scientific, literary or educational purposes, or for the prevention of cruelty to children or animals, no part of the net earnings of which inures to the benefit of any private shareholder or individual;
(7) Service performed by an individual for an employer as an insurance agent or as an insurance solicitor, if all the service performed by the individual for the employer is performed for remuneration solely by way of commission;
(8) Service performed in the employ of a school, college or university, if the service is performed:
(A) By a student who is enrolled and is regularly attending classes at the school, college or university; or
(B) By the spouse of the student, if the spouse is advised, at the time the spouse commences to perform the service, both that:
(i) The employment of the spouse to perform the service is provided under a program to provide financial assistance to the student by the school, college or university; and
(ii) The employment will not be covered by any program of unemployment insurance;
(9) Service performed by an individual who is enrolled at a nonprofit or public educational institution that normally maintains a regular faculty and curriculum and normally has a regularly organized body of students in attendance at the place where its educational activities are carried on, as a student in a full-time program, that is taken for credit and that combines academic instruction with work experience, if the service is an integral part of the program, and the institution has so certified to the employer, except that this subdivision (c)(9) does not apply to service performed in a program established for or on behalf of an employer or group of employers;
(10) Service performed in the employ of a hospital, if the service is performed by a patient of the hospital, as defined in subdivision (f)(7);
(11) Service performed by a qualified real estate agent if:
(A) The individual is a licensed real estate agent;
(B) Substantially all of the remuneration for the services performed as a real estate agent is directly related to sales or other output, including the performance of services, rather than the number of hours worked; and
(C) The services performed by the individual are performed pursuant to a written contract between the individual and the person for whom the services are performed, and the contract provides that the individual will not be treated as an employee with respect to the services for federal tax (FUTA) purposes;
(12) Service performed by a direct seller, including an individual engaged in the trade or business of the delivery or distribution of newspapers or shopping news, if:
(A) The individual is engaged in the trade or business of selling or soliciting the sale of consumer products to any buyer on a:
(i) Buy-sell basis;
(ii) Deposit-commission basis; or
(iii) Any similar basis that the United States secretary of treasury prescribes by regulations, for resale by the buyer or any other individual, in the home or otherwise than in a permanent retail establishment; or
(B) The individual is engaged in the trade or business of selling or soliciting the sale of consumer products to a consumer in the home or somewhere other than in a permanent retail establishment; and
(i) Substantially all of the remuneration for the services performed as a direct seller is directly related to sales or output, including the performance of services, rather than to the number of hours worked; and
(ii) The services performed by the individual are performed pursuant to a written contract between the individual and the person for whom the services are performed, and the contract provides that the individual will not be treated as an employee with respect to the services for federal tax (FUTA) purposes;
(13) Service performed by a full-time student in the employ of an organized camp, if:
(A) The camp did not operate for more than seven (7) months in the calendar year and did not operate for more than seven (7) months in the preceding calendar year, or had average gross receipts for any six (6) months in the preceding calendar year that were not more than thirty-three and one third percent (33 1/3%) of its average gross receipts for the other six (6) months in the preceding calendar year;
(B) The full-time student performed services in the employ of the camp for less than thirteen (13) calendar weeks in the calendar year; and
(C) For purposes of this subdivision (c)(13), an individual shall be treated as a full-time student for any period during which the individual is enrolled as a full-time student at an educational institution, or that is between academic years or terms if the individual was enrolled as a full-time student at an educational institution for the immediately preceding academic year or term, and there is reasonable assurance that the individual will be so enrolled for the immediately succeeding academic year or term;
(14) Service performed by an individual on a boat, or boats in the case of a fishing operation involving more than one (1) boat, engaged in catching fish or other forms of aquatic animal life under an arrangement with the owner or operator of the boat pursuant to which:
(A) The individual does not receive any cash remuneration, other than as provided in subdivision (c)(14)(B);
(B) The individual receives a share of the boat's or boats' catch of fish or other forms of aquatic animal life or a share of the proceeds from the sale of the catch;
(C) The amount of the individual's share depends on the amount of the boat's or boats' catch of fish or other forms of aquatic animal life, but only if the operating crew of the boat, or each boat from which the individual receives a share in the case of a fishing operation involving more than one (1) boat, is normally made up of fewer than ten (10) individuals;
(15) Service performed by an individual as a product demonstrator pursuant to a written contract between the individual and a person whose principal business is providing demonstrators to third parties for those purposes, and the contract provides that the individual will not be treated as an employee with respect to the services;
(16) The service performed on or after January 1, 1995, by an individual who is an alien admitted to the United States to perform service in agricultural labor pursuant to §§ 101(a)(15)(H) and 214(c) of the Immigration and Nationality Act, codified in 8 U.S.C. §§ 1101(a)(15)(H) and 1184, respectively;
(17) After June 30, 1999, service performed by an election official or an election worker, if the amount of remuneration received by the individual during the calendar year for services as an election official or election worker is less than one thousand dollars ($1,000); and
(18) (A) Notwithstanding any provision of this chapter or any other law to the contrary, companion-sitters who receive referrals under registry or referral arrangements substantially similar to those addressed within the IRS determination shall not be classified as employees of the person, corporation or business entity pursuant to this chapter, unless the person, corporation or business entity and the department mutually agree to the reclassification of the companion sitters as employees of the person, corporation or business entity in order to absolve the elderly, sick or disabled clients or the parents of the children from liability for payment of any premiums, fees or other costs that may be imposed pursuant to the Tennessee Employment Security Law, if:
(i) A person, corporation or business entity maintains an employment registry or referral service exclusively for companion sitters seeking employment opportunities for providing personal attendant, companionship, household care, ancillary health care or related services to children, the elderly, or sick or disabled clients;
(ii) The companion sitters do not provide personal attendant, companionship, household care, ancillary health care or related services for hire to nonprofit organizations, Indian tribes or state or local governments; and
(iii) Pursuant to the federal Insurance Contributions Act, the federal Unemployment Tax Act, or the collection of income tax at source on wages, chapters 21, 23 and 24, respectively, Subtitle C, Internal Revenue Code, compiled in 26 U.S.C. § 3101 et seq., 26 U.S.C. § 3301 et seq., and 26 U.S.C. § 3401 et seq., respectively, the Internal Revenue Service issues a determination that a companion-sitter is not an employee of the person, corporation or business entity under the typical registry or referral arrangements of the person, corporation or business entity;
(B) This section shall not be construed to require forgiveness or refund of any premiums, fees or other related costs duly imposed prior to July 1, 2004.
(d) Tennessee Service. For purposes of this section, Tennessee service means any of the following:
(1) Any individual's entire service, performed within or both within and without this state, if the service is localized in this state. Service shall be deemed to be localized within a state if either:
(A) The service is performed entirely within the state; or
(B) The service is performed both within and without the state but the service performed without the state is incidental to the individual's service within the state; for example, is temporary or transitory in nature or consists of isolated transactions;
(2) An individual's entire service, performed within and without this state, if the service is not localized in any state but some of the service is performed in this state and:
(A) The individual's base of operations is in this state; or
(B) If there is no base of operations, then the place from which the service is directed or controlled is in this state; or
(C) The individual's base of operations or place from which the service is directed or controlled is not in any state in which some part of the service is performed, but the individual's residence is in this state;
(3) Service wherever performed within the United States, or Canada, if both:
(A) The service is not covered under the unemployment compensation law of any other state or Canada; and
(B) The place from which the service is directed or controlled is in this state;
(4) Service that is performed after December 31, 1971, except service performed in Canada, by an individual who is a citizen of the United States and who is in the employ of an American employer, other than service that is deemed to be Tennessee employment under subdivisions (d)(1) and (2) or to be employment under the parallel provisions of another state's law, if:
(A) The employer's principal place of business in the United States is located in this state; or
(B) The employer has no place of business in the United States, but:
(i) The employer is an individual who is a resident of this state;
(ii) The employer is a corporation that is organized under the laws of this state; or
(iii) The employer is a partnership or a trust and the number of the partners or trustees who are residents of this state is greater than the number who are residents of any other state; or
(C) None of the criteria of subdivisions (d)(4)(A) and (B) are met, but the employer has elected coverage in this state or, the employer having failed to elect coverage in any state, the individual has filed a claim for benefits, based on the service under the laws of this state;
(5) Specifically in the case of included service described in subdivision (b)(5), service where the operating office from which the operations of the American vessel, operating on navigable waters within the United States, or the operations of the American aircraft within the United States, or the operations of both the vessel and the aircraft within and without the United States are ordinarily and regularly supervised, managed, directed and controlled is within this state; or
(6) Specifically in the case of included service described in subdivision (b)(10), service when the individual performing the service is a resident of this state.
(e) Special Rules. The following rules shall govern for purposes of this section:
(1) Service performed by an individual shall be deemed to be included service for purposes of this section regardless of whether the common law relationship of master and servant exists, unless and until it is shown to the satisfaction of the administrator that:
(A) The individual has been and will continue to be free from control and direction in connection with the performance of the service, both under any contract for the performance of service and in fact;
(B) The service is performed either outside the usual course of the business for which the service is performed or is performed outside of all the places of business of the enterprise for which the service is performed; and
(C) The individual is customarily engaged in an independently established trade, occupation, profession or business of the same nature as that involved in the service performed; and
(2) It is the legislative intent that no elected official shall be eligible for benefits based upon service as an elected official.
(f) Section Definitions. The following words and terms have the following respective meanings for the purposes of this section, unless the context otherwise requires:
(1) Agricultural labor means remunerated service performed after December 31, 1971:
(A) On a farm, in the employ of any person, in connection with cultivating the soil, or in connection with the raising or harvesting of any agricultural or horticultural commodity, including the raising, shearing, feeding, caring for, training, and management of livestock, bees, poultry, and fur-bearing animals and wildlife;
(B) In the employ of the owner or tenant or other operator of a farm, in connection with the operation, management, conservation, improvement or maintenance of the farm and its tools and equipment, or in salvaging timber or clearing land of bush and other debris left by a hurricane, if the major part of the service is performed on a farm;
(C) In connection with the production or harvesting of any commodity defined as an agricultural commodity in § 15(g) of the Agricultural Marketing Act, codified in 12 U.S.C. § 1141j, or in connection with the ginning of cotton, or in connection with the operation or maintenance of ditches, canals, reservoirs or waterways, not owned or operated for profit, and used exclusively for supplying and storing water for farming purposes;
(D) In the employ of either:
(i) The operator of a farm in handling, planting, drying, packing, packaging, processing, freezing, grading, storing or delivering to storage or to market or to a carrier for transportation to market, in its unmanufactured state, any agricultural or horticultural commodity, but only if the operator produced more than one half (½) of the commodity with respect to which the service is performed; or
(ii) In the employ of a group of operators of farms, or a cooperative organization of which the operators are members, in the performance of service described in subdivision (f)(1)(D)(i), but only if the operators produced more than one half (½) of the commodity with respect to which the service is performed; provided, that this subdivision (f)(1)(D) shall not be deemed to include service performed in connection with commercial canning or commercial freezing or in connection with any agricultural or horticultural commodity after its delivery to a terminal market for distribution for consumption; or
(E) On a farm operated for profit if the service is not in the course of the employer's trade or business or is not domestic service in a private home of the employer;
(2) American aircraft means an aircraft registered under the laws of the United States;
(3) American employer means a person who is:
(A) An individual who is a resident of the United States;
(B) A partnership, if two thirds (2/3) or more of the partners are residents of the United States;
(C) A trust, if all of the trustees are residents of the United States; or
(D) A corporation organized under the laws of the United States or of any state;
(4) American vessel means any vessel documented or numbered under the laws of the United States; and includes any vessel that is neither documented nor numbered under the laws of the United States nor documented under the laws of any foreign country, if its crew performs service solely for one (1) or more citizens or residents of the United States or corporations organized under the laws of the United States or of any state;
(5) Crew leader means an individual who:
(A) Furnishes individuals to perform service in agricultural labor for any other person;
(B) Pays, either on the individual's own behalf or on behalf of the other person, for the service in agricultural labor performed by them; and
(C) Has not entered into a written agreement with the other person under which the individual is designated as an employee of the other person;
(6) Hospital means an institution that has been licensed, certified or approved by the hospital licensing board of the department of health as a hospital; and
(7) Institution of higher education means:
(A) Any college or university in this state; or
(B) An educational institution that meets all of the following conditions:
(i) It admits as regular students only individuals having a certificate of graduation from high school, or the recognized equivalent of such a certificate;
(ii) It is legally authorized in this state to provide a program of education beyond high school;
(iii) It provides an educational program for which it awards a bachelor's or higher degree, or provides a program that is acceptable for full credit toward such a degree, a program of post-graduate or post-doctoral studies, or a program of training to prepare students for gainful employment in a recognized occupation; and
(iv) It is a public or other nonprofit institution.
(g) Chapter Definition. Unless the context otherwise requires, farm includes stock, dairy, poultry, fruit, fur-bearing animals, and truck farms, plantations, ranches, nurseries, ranges, greenhouses or other similar structures used primarily for the raising of agricultural or horticultural commodities, and orchards.
[Acts 1947, ch. 29, § 2; 1949, ch. 20, § 1; 1949, ch. 226, § 7; C. Supp. 1950, § 6901.2 (Williams, § 6901.26); Acts 1957, ch. 146, § 1; 1961, ch. 70, § 1; impl. am. Acts 1971, ch. 162, § 3; Acts 1971, ch. 204, § 2; 1973, ch. 130, § 2; 1974, ch. 460, § 1; 1977, ch. 330, §§ 2-9, 32; 1978, ch. 744, §§ 1, 2; T.C.A. (orig. ed.), § 50-1309; Acts 1983, ch. 368, §§ 1, 2; 1984, ch. 701, § 1; 1985, ch. 318, § 11; 1986, ch. 597, § 1; 1987, ch. 148, §§ 2-4; 1989, ch. 333, §§ 1, 2; 1990, ch. 777, § 1; 1992, ch. 694, §§ 1, 2; 1993, ch. 194, §§ 1-7; 1995, ch. 239, § 2; 1997, ch. 104, §§ 1-3; 1999, ch. 76, §§ 1, 2; 2004, ch. 556, § 1; 2004, ch. 946, § 1.]