Complaint Review: Professional Support Services Inc. - Elizabeth Maracin - Lancaster Kentucky

Please note that I was paid in full in July 2005. Although the payment was several months late, no legal intervention was necessary. Thank you.

Litigation certainly becomes more complex when the parties are "diverse," which is the unecessarily complicated legal way of saying "from different states." First, however, the potential complexities of litigation should not prevent you from asserting your claims in an informal manner, i.e. a demand letter. And I wouldn't forego the threat of litigation even if you are unsure that you would actually pursue litigation. Next, then, the problem with inter-state claims. There are, as far as I can think, four things that would prevent you from being able to bring this claim in your home state. First, your home courts may lack personal jurisdiction over PSS. This is not likely, as their relationship with you should satisfy the "minimum contacts" rule that would permit your home courts to take jurisdiction over matters relating to that relationship (it's called "specific jurisdiction"). Second, your home courtsmay be an improper venue for this claim. This is also not likely because the place where the activities giving rise to the claim take place is usually an appropriate venue. Third, your contract may contain a "forum selection clause," which mandates that any disputes arising from the contract be litigated in Kentucky. This is not to be confused with a "choice of laws" clause, which would mandate that any disputes would be resolved under the laws of Kentucky, but not necessarily in Kentucky courts (yes, state courts can hear and decide cases under the laws of different states). And, finally, your contract may contain an arbitration clause. The issue that arises with problems three and four (forum selection and arbitration clauses) is whether the courts will actually enforce these clauses. In the business context (i.e. business to business), these clauses are usually upheld. In the consumer context (business to consumer) they are less likely to be upheld. At any rate, a crafty lawyer could probably get around any procedural (jurisdiction/venue/etc.) problems that your claim may pose. Of course, doing so would probably be costly, and I have only skimmed the surface of potential problems. It's unfortunate that these kind of small-claims disputes often fly under the radar of what the law will end up addressing. Your claim could be a good candidate for class action if your story is shared by several people. That way you can share the costs of litigation, but you also may end up sharing the reward, which means you may get less than you would have had you gone alone. This is the beast that is American law.

Litigation certainly becomes more complex when the parties are "diverse," which is the unecessarily complicated legal way of saying "from different states." First, however, the potential complexities of litigation should not prevent you from asserting your claims in an informal manner, i.e. a demand letter. And I wouldn't forego the threat of litigation even if you are unsure that you would actually pursue litigation. Next, then, the problem with inter-state claims. There are, as far as I can think, four things that would prevent you from being able to bring this claim in your home state. First, your home courts may lack personal jurisdiction over PSS. This is not likely, as their relationship with you should satisfy the "minimum contacts" rule that would permit your home courts to take jurisdiction over matters relating to that relationship (it's called "specific jurisdiction"). Second, your home courtsmay be an improper venue for this claim. This is also not likely because the place where the activities giving rise to the claim take place is usually an appropriate venue. Third, your contract may contain a "forum selection clause," which mandates that any disputes arising from the contract be litigated in Kentucky. This is not to be confused with a "choice of laws" clause, which would mandate that any disputes would be resolved under the laws of Kentucky, but not necessarily in Kentucky courts (yes, state courts can hear and decide cases under the laws of different states). And, finally, your contract may contain an arbitration clause. The issue that arises with problems three and four (forum selection and arbitration clauses) is whether the courts will actually enforce these clauses. In the business context (i.e. business to business), these clauses are usually upheld. In the consumer context (business to consumer) they are less likely to be upheld. At any rate, a crafty lawyer could probably get around any procedural (jurisdiction/venue/etc.) problems that your claim may pose. Of course, doing so would probably be costly, and I have only skimmed the surface of potential problems. It's unfortunate that these kind of small-claims disputes often fly under the radar of what the law will end up addressing. Your claim could be a good candidate for class action if your story is shared by several people. That way you can share the costs of litigation, but you also may end up sharing the reward, which means you may get less than you would have had you gone alone. This is the beast that is American law.

Litigation certainly becomes more complex when the parties are "diverse," which is the unecessarily complicated legal way of saying "from different states." First, however, the potential complexities of litigation should not prevent you from asserting your claims in an informal manner, i.e. a demand letter. And I wouldn't forego the threat of litigation even if you are unsure that you would actually pursue litigation. Next, then, the problem with inter-state claims. There are, as far as I can think, four things that would prevent you from being able to bring this claim in your home state. First, your home courts may lack personal jurisdiction over PSS. This is not likely, as their relationship with you should satisfy the "minimum contacts" rule that would permit your home courts to take jurisdiction over matters relating to that relationship (it's called "specific jurisdiction"). Second, your home courtsmay be an improper venue for this claim. This is also not likely because the place where the activities giving rise to the claim take place is usually an appropriate venue. Third, your contract may contain a "forum selection clause," which mandates that any disputes arising from the contract be litigated in Kentucky. This is not to be confused with a "choice of laws" clause, which would mandate that any disputes would be resolved under the laws of Kentucky, but not necessarily in Kentucky courts (yes, state courts can hear and decide cases under the laws of different states). And, finally, your contract may contain an arbitration clause. The issue that arises with problems three and four (forum selection and arbitration clauses) is whether the courts will actually enforce these clauses. In the business context (i.e. business to business), these clauses are usually upheld. In the consumer context (business to consumer) they are less likely to be upheld. At any rate, a crafty lawyer could probably get around any procedural (jurisdiction/venue/etc.) problems that your claim may pose. Of course, doing so would probably be costly, and I have only skimmed the surface of potential problems. It's unfortunate that these kind of small-claims disputes often fly under the radar of what the law will end up addressing. Your claim could be a good candidate for class action if your story is shared by several people. That way you can share the costs of litigation, but you also may end up sharing the reward, which means you may get less than you would have had you gone alone. This is the beast that is American law.

Litigation certainly becomes more complex when the parties are "diverse," which is the unecessarily complicated legal way of saying "from different states." First, however, the potential complexities of litigation should not prevent you from asserting your claims in an informal manner, i.e. a demand letter. And I wouldn't forego the threat of litigation even if you are unsure that you would actually pursue litigation. Next, then, the problem with inter-state claims. There are, as far as I can think, four things that would prevent you from being able to bring this claim in your home state. First, your home courts may lack personal jurisdiction over PSS. This is not likely, as their relationship with you should satisfy the "minimum contacts" rule that would permit your home courts to take jurisdiction over matters relating to that relationship (it's called "specific jurisdiction"). Second, your home courtsmay be an improper venue for this claim. This is also not likely because the place where the activities giving rise to the claim take place is usually an appropriate venue. Third, your contract may contain a "forum selection clause," which mandates that any disputes arising from the contract be litigated in Kentucky. This is not to be confused with a "choice of laws" clause, which would mandate that any disputes would be resolved under the laws of Kentucky, but not necessarily in Kentucky courts (yes, state courts can hear and decide cases under the laws of different states). And, finally, your contract may contain an arbitration clause. The issue that arises with problems three and four (forum selection and arbitration clauses) is whether the courts will actually enforce these clauses. In the business context (i.e. business to business), these clauses are usually upheld. In the consumer context (business to consumer) they are less likely to be upheld. At any rate, a crafty lawyer could probably get around any procedural (jurisdiction/venue/etc.) problems that your claim may pose. Of course, doing so would probably be costly, and I have only skimmed the surface of potential problems. It's unfortunate that these kind of small-claims disputes often fly under the radar of what the law will end up addressing. Your claim could be a good candidate for class action if your story is shared by several people. That way you can share the costs of litigation, but you also may end up sharing the reward, which means you may get less than you would have had you gone alone. This is the beast that is American law.

I am glad that someone has taken an interest in this, and you make very valid points. Unfortunately, litigation is very costly. My understanding is that even filing in small claims court would require travel to Kentucky. The small claims court system in Kentucky allow attorney representation. I do not have much legal knowledge, only what I have gleaned from my own research and - although you stated that you are not an attorney - your comments in reference to employee/IC status did have me second-guessing myself. One thing I know for sure is that Professional Support Services owes me a lot of money. Professional Support Services owes a lot of people a lot of money. Ideally, there would be a way for all of us to "join forces" against the company. I don't know how, exactly, because we are all strewn across the country. With the way people are treated, however, I don't believe that Professional Support Services will be in business much longer. I only hope to be paid what is due to me before they go down.

My apologies if I was coming off as argumentative. I am quite well-versed in this little area of the law (employment distinctions) and was merely trying to fill you in on the jurisprudence. The whole discussion was more academic than anything, because it is really only pertinent to the question of whether your employer is dodging certain taxes, and this has little to do with your central issue. However, the law does provide more protection for employees than for independent contractors. Minimum wage, maximum hours, all those laws aside, the "employee" has available to him the assistance of administrative agencies, whereas the independent contractor must resort to standard legal processes. The problem, however, is that if your employer has termed you an "independent contractor," and you wish to enjoy the benefits of being an "employee," you would probably have to litigate the matter. This usually doesn't make much sense because such litigation is costly and complex, and you could directly litigate your contract issues without resorting to a trial over employment designations. If your problem is as simple as "I was told that if I did X amount of work, I would get paid X dollars; I did X amount of work, but have only been paid Y dollars" then you probably have a simple contract claim. This claim could, ideally, be resolved with a demand for accounting. I've assisted friends in drafting these letters in similar situations, and have succeeded in obtaining unpaid wages/fees every time. Employers who use the independent contractor status in a questionable manner are frequently apt to dodge paying their laborers, but once they are faced with potential litigation they crumble like a week old cookie. All you really need to do is draft up an invoice for what you feel that you are owed, and demand either that you be paid the money or be told why you are not owed the money. Follow up with a threat of litigation in the event that your letter receives no response or the response is full of illegitimate excuses. If this doesn't work, either find a lawyer or file a small claims complaint. Ideally, you should have a lawyer draft the letter for you, but budgetary constraints may make this difficult. At any rate, I hope you get paid what you are due. If you have any questions, don't hesitate to ask. Just don't take anything I say as competent legal advice - I am not a lawyer, and you are not my client.

I feel as if I am getting into an argument with you, but I have no idea who you are or what interest you have in my report or this company. Please understand that I do not not mean to argue, nor do I mean to make false statements. I applied for and was hired for a QA (Quality Assurance) position. The agreement was that I could accept or reject assignments and be paid 25 cents per completed page. After a month, I was asked to be "QA Assistant." I was still to be paid 25 cents per page, but I would no longer have the option to accept/reject assignments. I was responsible for proofreading all of the documents that came through. Some of the transcripts were over 200 pages long and had 8 hours of audio. I spent 8 to 16 hours on the computer per day. I was to do this work with a "Lead QA," but her computer was broken and she was not available much of the time. In addition to proofreading, as "QA Assistant" I was now also responsible for training new workers and scheduling assignments. I was also responsible for indexing the transcripts, a time-consuming process. I spent a lot of uncompensated time emailing and Instant Messaging in response to questions from the owner and from the workers. This time took away from the time that I spent proofreading. By the time I finished an assignment, I often calculated that the rate of pay was less than a dollar per hour. When I complained, I was told, via email, that the owner of the company was establishing a percentage rate so that I would be properly compensated for the extra time I spent working. However, after a month, this had still not occurred. Given the circumstances, I could not work for anyone else. There was not enough time in a day. Also, Professional Support Services is strictly a transciption company. The company utilizes typists and proofreaders because they perform the "integral" part of the the company's services. The only part. I would also like to mention that the owner wanted me to create an Employee File in Excel for her, so that she could track the performance of her workers. There were to be online training sessions and attendance was mandatory. She stated to me, in an email, that workers who attended the training sessions would be entitled to pay raises after 30, 60, and 90 days. Granted, in the eyes of the law, her workers may very well all be considered Independent Contractors. However, the $920.12 that is owed to me is based upon the 25 cents per page that was originally agreed-upon. This amount does not account for any hourly rates whatsoever.

Thoe factors certainly speak in favor of an employment relationship. I would certainly not, however, go so far as to say "clearly." Dictation of which tools and materials must be used is a minor element of the consideration. Consider a house painter: the peron who hires him tells him which color and, often, which product to use, but he is NOT the employee of the home-owner. In fact, in most independent contractor situations the utilizor will require the use of specific tools and materials. Not that this factor doesn't speak in your favor, just that it doesn't add much weight to your argument. Specifying which jobs must be done is also a standard element of the independent contractor relationship. The person engaging the labor of several others need not allow those people to perform any task they desire to avoid an employer-employee determination. But, again, this does speak in your favor somewhat. Most courts, in making an employee vs. independent contractor determination, will look primarily to the degree of direct supervision and control exerted by the "putative" (in this context, it means "alleged") employer. They are very averse to finding an employer-employee relationship where the putative employer exerts little or no control or supervision over the day-to-day activities of the putative employee. In other words, if your putative employer isn't exercising a "looking over your shoulder" kind of supervision, you are probably an independent contractor in the eyes of the law. I have seen cases where a putative employer did everything but directly supervise their laborers including supplying the necessary tools, dictating which tasks to perform and when to perform them, and exerting supervision through other independent contractors, and there was no employer-employee relationship found. I have also seen cases where less evidence of such a relationship HAS resulted in an employer-employee determination. The bottom line is that there really is no "clearly" when it comes to independent contractor vs. employee determinations, especially where there is little or no direct supervision during the performance of given tasks. The law is trending away from the common law control based test and towards an "economic reality" test that looks not to the level of involvement of the putative emplyer, but to the "economic dependence" of the parties. Under this test, an employer who requires the work of certain laborers to perform an integral part of the employer's business, and where such laborers are dependent on the employer for work (don't perform work for multiple parties), plus a few other factors, is in an employer-employee relationship. In my mind, this is a much better test, but it has proven much more difficult to apply in those situations where it is required.

I do want to clarify that there is a difference between an Independent Contractor status versus an Employer/Employee relationship. Where working from a home office and submitting invoices may indicate an Independent Contractor status, the circumstances of this working relationship indicate otherwise. Professional Support Services dictates what software must be used, what transcription foot pedal should be used, and issues instruction manuals that are 30-45 pages long with specific formatting and word usage directions, plus several pages of templates to use for assignments. In addition, Liz Maracin, President of Professional Support Services, will email the workers to let them know which assignments they are allowed to invoice for. If a worker invoices for an assignment that Liz does not list, then Liz will cross the assignment out on the invoice and pay according to what she feels is "billable" at that time. Liz also provides the invoice template and will not allow workers to use their own invoices. There are many other factors, of course, but the two listed above clearly indicate a certain degree of control that Professional Support Services, Inc. has over its workers and is indicative of an Employer/Employee relationship.

The common law distinction between an "employee" and an "independent contractor is, for the most part, based on the amount of control and supervision exercised by the employer. If your employer exerts close supervision over your activities, dictates which activities you will perform and when you will perform them, and is generally nivolved in your day-to-day work affairs, then you are probably an employee. If, on the other hand, your employer simply gives you a task and leaves the administration up to you, you are probably an independent contractor. The fact that you worked at home, and the fact that you submitted invoices for your work, speak heavily (but not necessarily determinatively) in favor of an independent contractor status. The IRS probably has a more specific test for determining whether one is an employee or an independent contractor, and I would venture to guess that there are a host of non-quantitative factors that are taken into account. If you still feel that you were/are an employee rather than an independent contractor, then by all means report this to the IRS. Tax evaders raise the taxes on everyone else and make less mone available for necessary government services. Per your uncouped income, I would recommend first that you find a lawyer to write a demand letter for you. If this doesn't pan out, a small claims action may be your best bet. Good luck!