Clapp, Jayne and Francis. The opinion of the court was delivered by Francis, J.A.D.
[33 NJSuper Page 433] The previous history of this cause appears in 32 N.J. Super. 57 (App. Div. 1954). The
Appellate Division in its opinion reported there disposed of all of the attacks upon the approval by the Commissioner of Labor and Industry of a determination by the Division of Employment Security that appellant occupied subject status as an employer under the Unemployment Compensation Law (R.S. 43:21-1 et seq. , as amended) between January 1, 1941 and December 31, 1945, except the attack upon the constitutionality of section 19(h)(4) of the act (N.J.S.A. 43:21-19(h)(4)). On that phase of the matter, the court concluded that the question had not been presented adequately and counsel were given leave to file supplemental briefs. Advantage was taken of the permission and the constitutional issue has now been submitted to us.
For purposes of reorientation a concise statement of the factual situation so far as it relates to the present problem seems necessary. Cliffside Dyeing Corporation was organized May 8, 1940 with three officers and stockholders. Plaintiff, Hillside Holding Corp., came into being on November 15 of the same year; its only officers and stockholders were the same three persons. Hillside was a holding company; Cliffside an operating one. Cliffside operated a dying plant with machinery and equipment owned by Hillside and leased to it. The only employees of Hillside were the three officers referred to. In addition to the three officers who were common to both corporations, Cliffside had a substantial number of employees, many more than required to make it a subject employer for unemployment compensation purposes.
Accordingly, Cliffside made contributions to the compensation fund as required by the act on the basis of the number of employees and the amount of their wages up to the prescribed maximum. N.J.S.A. 43:21-7. The salaries paid to the three common officers were included in the computation of the contributions.
However, the three common officers being its only employees, Hillside did not consider itself within the coverage of the Act and consequently made no contributions. In November 1953 the Director of the Division of Employment Security concluded that it was a subject employer by virtue
of section 19(h)(4) and made assessments for contributions on the basis of the wages paid to the three officers.
Section 19 (N.J.S.A. 43:21-19) provides, among other things:
"(g) 'Employing unit' means any individual or type of organization, including any partnership, association, trust, estate, joint-stock company, insurance company or corporation * * * which has * * * in its employ one or more individuals performing services for it within this State. * * *
(1) Any employing unit which for some portion of a day * * * in each of twenty different weeks * * * has or had in employment, eight or more individuals * * *. [Four or more since 1945.]
(4) Any employing unit which together with one or more other employing units, is owned or controlled (by legally enforceable means or otherwise) directly or indirectly by the same interests, or which owns or controls one or more other employing units (by legally enforceable means or otherwise), and which, if treated as a single unit with such other ...