COVERAGE OF EMPLOYEES ASSIGNED TO OUT OF STATE DUTIES UNDER THE UNEMPLOYMENT COMPENSATION ACT.
Supervisory employees of a corporation having its principal place of business within the State of Washington who are assigned to other states for the performance of certain services are in "employment" under the Unemployment Compensation Act because of the fact that they are controlled and directed from within the State of Washington and are residents of that state.
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May 4, 1953
Honorable L. H. Bates
Employment Security Department
Old Capitol Building
Olympia, Washington Cite as: AGO 53-55 No. 30
You have requested our opinion as to whether or not supervisory employees of a manufacturing plant located in Seattle, sent to other states on temporary assignments of indefinite duration, are in "employment" within this state under the Unemployment Compensation Act of chapter 35, Laws of 1945, and amendments thereto.
We conclude that such employees are within "employment" under RCW 50.04.110 of the Revised Code of Washington.
Your letter indicates that such employees are considered both by themselves and by the company as residents of the State of Washington. You further set out that most of the employees return to Seattle at intervals for additional directions and to make reports upon the progress of work supervised without the state. The employer has made contributions on the salaries of all these employees under the Washington Unemployment Compensation Act.
Our conclusion requires a construction of RCW sections 50.04.110 and 50.04.120. RCW 50.04.110 reads as follows:
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"The term 'employment' shall include an individual's entire service performed within or both within and without this state, if:
"(1) The service is localized in this state; or
"(2) The service is not localized in any state, but some of the service is performed in this state, and
"(a) the base of operations, or if there is no base of operations, then the place from which such service is directed or controlled is in this state; or
"(b) the base of operations or place from which such 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."
RCW 50.04.120 provides:
"Service shall be deemed to be localized within a state, if:
" * * *
"(2) 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."
Some of the employees mentioned may fall within the definition of RCW 50.04.120 (2) by reason of basic assignment at the Seattle plant and temporary assignments to other states. These employees would therefore be covered under RCW 50.04.110 (1), their service being localized within the state.
Most of the services performed in the factual situation presented apparently come within subdivision (2) of RCW 50.04.110, as those services are not localized in any state, and some of the service is performed in this state; as it is an important and integral part of each individual's performance of service that he confer with and report to his superiors at the Seattle plant.
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We do not believe it necessary for us to express an opinion on the point that Seattle is the base of operations because of the fact that the direction and control of the activity of the employees concerned is clearly at the main plant which is located within the State of Washington. It affirmatively appears that such control is actually exercised, in most cases, at the Seattle plant and it does not appear in the inquiry that such supervisory employees are subject to control from any other place. SeeClaim of Mallia, 299 N.Y. 232, 86 N.E. (2d) 277, in which the New York Court of Appeals indicated under a virtually identical statute that the control contemplated by the Act was "exercised" control. Thus employees whose service is not localized and is controlled or directed from Seattle fall within the coverage of RCW 50.04.110 (2) (a), if they perform some part of their service in Washington.
Even if it could be said that the employees with whom we are here concerned were not subject to direction or control from the main plant at Seattle, nevertheless, there would be a coverage under the above quoted section of the statute for the reason that they are residents of the State of Washington. Claim of Mallia, supra. We assume from your letter that these employees were residents of the State of Washington at the time that they were assigned to other states. They are paid additional sums over their usual salary in most cases, either on a per diem basis or on a straight basis, while absent from the state. It is also understood that if an employee is discharged, such discharge will not take effect until the employee has returned to Seattle, unless the employee elects otherwise. These facts lead to the conclusion that it was the intent of both the company and the employee that the employee, upon completion of his assignment, return to Seattle. We can see no logical distinction between the situation presented by your letter and that inKankelborg v. Kankelborg, 199 Wash. 259, 90 P. (2d) 1018. Our Supreme Court there held that an enlisted man had made Bremerton his residence by registering to vote there and expressing his intention to live there, and that his residence in Bremerton continued thereafter, despite frequent and lengthy naval assignments in other areas, since he never acted thereafter to change it.
Naturally, an opinion written on a general inquiry such as residence involving a number of persons cannot be deemed authoritative as to each of such persons when an individual may by his own actions create a new residence for himself in another state. Thus, if an individual employee should register for voting, run for office, or in some other manner definitely evidence his intention to make the state to which he has been assigned the state of his residence, this opinion would not be controlling.
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We believe therefore that most of these employees, even if not controlled or directed from Seattle, would be within the coverage of RCW 50.04.110 (2) (b) by virtue of residence in Washington. We have found no Washington case in conflict with the foregoing conclusions.
We are not advised that any state in which any of these employees are physically located has claimed that any of them are within employment in their state. We believe that this would be contrary to a proper construction of the unemployment compensation act of any state with which we are familiar. These sections of the Washington law are uniform with the laws of other states so that services performed in more than one state will not be subject to more than one state law. If any such state should make such a claim it would seem to us, if negotiations by the Commissioner with that state were not successful, that the Commissioner would be authorized to consider such persons not in employment or to reimburse the employer so as to avoid double taxation. We are advised that in some instances such administrative decisions, and such refunds, have been made.
It is, therefore, our conclusion that the supervisory employees above referred to are in "employment" within this state and are covered by the Unemployment Compensation Act.
Very truly yours,
J. D. THOMAS, JR.
Assistant Attorney General