Title 56 IDES RULES Part 2732
R-77 (05/11)
h) Section 212.1(a)(4) of the Act
Section 212.1 (a)(4) is not satisfied unless:
1) the individual performing the services leases or holds title to the truck, truck-tractor or tractor; and
Example: Smith operates a truck for ABC Trucking Company. ABC holds title to the truck. Section 212.1
does not exempt the services Smith performs for ABC from the Act's definition of "employment."
2) the individual or entity from which the truck, truck-tractor or tractor is leased or which holds a security or other
interest in the truck, truck-tractor or tractor is not:
A) the person or entity to which the individual operating the truck, truck-tractor or tractor is contracted to
perform the services; or
B) owned, controlled or operated by or in common with, to any extent, directly or indirectly, the person or
entity to which the individual operating the truck, truck- tractor or tractor is contracted to perform the
services or a family member of a shareholder, owner or partner of the person or entity with which the
individual is contracted to perform the services.
i) Example: Adams operates a truck for XYZ Trucking Company, a corporation in which Jones is the
majority shareholder. While Adams holds title to the truck, ABC Trucking Company, of which Jones is
the sole proprietor, holds a lien on Adams' truck. Section 212.1 does not exempt the services Adams
performs for XYZ from the Act's definition of "employment," since ABC is owned or controlled in
common with XYZ.
ii) Example: Madison operates a truck for XYZ Trucking, a corporation in which Jefferson is a five-percent
shareholder. Madison holds title to the truck, but ABC Finance Company, which is managed
by the brother of Jefferson's father-in-law, holds a lien on the truck. Section 212.1 does not exempt the
services Madison performs for XYZ from the Act's definition of "employment," since the individual
who operates ABC is a family member of a shareholder of XYZ.
iii) Example: ABC Trucking Company, a corporation, is being audited by the Department of Employment
Security to determine, among other items, whether services that Jones provided for ABC were
"employment" for purposes of the Act. ABC demonstrates that Jones held title to the truck he operated
in service to ABC while he was performing the services for ABC. ABC also provides a written
statement, signed by an owner or officer of ABC and attesting that the owner or officer has made
reasonable inquiries into the matter and, to the best of the owner's or officer's knowledge, while Jones
was performing the services for ABC, ABC did not have any interest in Jones' truck; no individual or
entity that might have held an interest in Jones' truck was owned, controlled or operated by or in
common with, to any extent, directly or indirectly, ABC, and no individual or entity that might have
held an interest in Jones' truck was owned, controlled or operated by or in common with, to any extent,
directly or indirectly, a family member of a shareholder of ABC. The auditor is not aware of any
evidence that contradicts the written statement. These facts indicate that paragraph (4) of Section 212.1
is satisfied with respect to the services Jones performed for ABC.
i) Section 212.1(a)(5) of the Act
1) Section 212.1(a)(5) is not satisfied unless the individual operating the truck, truck-tractor or tractor pays all
costs of licensing and operating the truck, truck-tractor or tractor. Section 212.1(a)(5) is not satisfied if the costs
of licensing or operating the truck, truck-tractor or tractor are separately reimbursed by an individual or entity
other than the individual operating the truck, truck-tractor or tractor. Costs not directly associated with the
operation or licensing of the truck, including but not limited to telephone charges, expenses related to the
loading or unloading of cargo and workers' compensation premiums with respect to the operator of a truck,
truck-tractor or tractor do not constitute costs of licensing or operating the truck, truck-tractor or tractor.
