June 3, 2013
JORGE M. PEREIRA, Petitioner-Appellant,
BOARD OF REVIEW, DEPARTMENT OF LABOR AND WORK FORCE DEVELOPMENT, and PEREIRA MASONRY, Respondents-Respondents.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Argued April 8, 201
On appeal from the Board of Review, Department of Labor, Docket Nos. 325, 147, 326, 064, 326, 065.
Anthony H. Guerino argued the cause for appellant (Mr. Guerino, attorney; Mr. Guerino and Donald J. Rinaldi, on the brief).
Christopher M. Kurek, Deputy Attorney General, argued the cause for respondent Board of Review (Jeffrey S. Chiesa, Attorney General, attorney; Lewis A. Scheindlin, Assistant Attorney General, of counsel; Mr. Kurek, on the brief).
Before Judges Ashrafi and Guadagno.
Petitioner Jorge M. Pereira appeals from a Final Decision of the Board of Review affirming three decisions of the Appeal Tribunal, finding his claims for unemployment benefits dated February 3, 2008, February 1, 2009, and January 30, 2011, were invalid pursuant to N.J.S.A. 43:21-19(i)(7)(C) and, as a consequence, he was liable to refund $13, 750 he had received as benefits. After reviewing the record in light of the contentions advanced on appeal, we affirm.
Jorge M. Pereira is a stone mason. Since 2006, he has been employed by Pereira Masonry, LLC (PML). Jorge's wife, Hilda Pereira, is the owner of PML. Jorge states that his work is seasonal, and during the winter months he is "laid off due to lack of work." On February 3, 2008, Jorge filed a claim for unemployment, after being laid off by PML. He was paid $7, 794 in unemployment benefits for the weeks ending February 9, 2008, through June 7, 2008. He filed a similar claim on February 1, 2009, and was paid $5, 956 for the weeks ending February 7, 2009, through April 25, 2009. When Jorge filed a third claim on January 30, 2011, he was denied benefits after it was determined that he was in the employ of his spouse.
On appeal, Jorge argues the decision of the Board of Review must be reversed because he is the employee of a limited liability company, not his spouse.
Our review here is limited. A final decision of an administrative body such as the Board of Review should not be disturbed on appeal unless it is arbitrary, capricious or unreasonable. Brady v. Bd. of Review, 152 N.J. 197, 210 (1997); Karins v. City of Atlantic City, 152 N.J. 532, 540 (1998). An appellate court should undertake a "careful and principled consideration of the agency record and findings." Riverside Gen. Hosp. v. N.J. Hosp. Rate Setting Comm'n., 98 N.J. 458, 468 (1985). The findings of the administrative body should be affirmed if they "could reasonably have been reached on sufficient credible evidence present in the record, considering the proofs as a whole . . . with due regard also to the agency's expertise . . . ." Close v. Kordulak Bros., 44 N.J. 589, 599 (1965) (citation omitted). Our Supreme Court has summarized the factors that must be considered.
(1) whether the agency's decision offends the State or Federal Constitution; (2) whether the agency's action violates express or implied legislative policies; (3) whether the record contains substantial evidence to support the findings on which the agency based its action; and (4) whether in applying the legislative policies to the facts, the agency clearly erred in reaching a conclusion that could not reasonably have been made on a showing of the relevant factors.
[Karins, supra, 152 N.J. at 540.]
N.J.S.A. 43:21-19(i) defines employment under the New Jersey Unemployment Compensation Law. N.J.S.A. 43:21-19(i)(7)(c) provides that employment shall not include, "[s]ervice performed by an individual in the employ of his son, daughter or spouse, and service performed by a child under the age of 18 in the employ of his father or mother[.]"
At the hearing before the Appeal Tribunal, Hilda testified that she is the owner of PML and that Jorge is an employee who "holds no title or any percentage of the business." Hilda also confirmed that she and Jorge file joint tax returns and she does not file a separate return for PML.
N.J.S.A. 42:2B-69(b) provides:
For all purposes of taxation on income under the laws of this State and only for those purposes, a limited liability company formed under P.L. 1993, c. 210 (C. 42:2B-1 et seq.) or qualified to do business in this State as a foreign limited liability company with one member is disregarded as an entity separate from its owner, unless classified other wise for federal tax purposes, in which case the limited liability company will be classified in the same manner as it is classified for federal income tax purposes. For all purposes of taxation on income under the laws of this State and only for those purposes, the sole member or an assignee of all of the limited liability company interest of the sole member of a limited liability company formed under P.L.1993, c. 210 (C. 42:2B-1 et seq.) or qualified to do business in this State as a foreign limited liability company is treated as the direct owner of the underlying assets of the limited liability company and of its operations, unless the limited liability company is classified otherwise for federal income tax purposes, in which case the member or assignee of a member will have the same status as the member or assignee of a member has for federal income tax purposes.
The determination by the Board of Review that Jorge was employed by his spouse is supported by substantial evidence in the record. His argument that he is employed by PML and not his wife is unavailing, as N.J.S.A. 42:2B-69(b) requires that PML as a LLC, "is disregarded as an entity separate from its owner."
The Board of Review correctly determined that Jorge was disqualified for unemployment benefits pursuant to N.J.S.A. 43:21-19(i)(7)(C) and was required to repay all unemployment benefits received pursuant to N.J.S.A. 43:21-16(d).