Harding Logistics Loses Fight Over Jobless Benefits
An Arkansas appeals court has ruled that Harding Logistics must pay unemployment taxes for a driver it treated as an independent contractor. The decision upholds the state’s finding that the driver was actually an employee.
The dispute began when a driver who hauled freight for Harding filed for unemployment benefits after the company ended their arrangement. Arkansas’s Department of Workforce Services investigated and determined the driver qualified as an employee, not a contractor. Harding appealed to the Board of Review, which agreed with the agency. The company then took the case to the Court of Appeals, arguing the driver controlled his own schedule and equipment.
The court examined how much control Harding exercised over routes, pay, and work rules. Judges found the company’s oversight and the driver’s reliance on Harding’s loads showed an employment relationship under state law. Because the driver was deemed an employee, Harding owes unemployment taxes on his wages. The ruling tightens the test Arkansas uses to separate contractors from employees in trucking.
Bottom Line: Treat drivers like employees if you control their work—or expect to pay unemployment taxes.
https://www.courtlistener.com/opinion/10861700/harding-logistics-inc-v-director/
What steps does your company take to classify drivers correctly?