Independent Contractor: Elements: Right to Fire

MONTANA SUPREME COURT DECISIONS

Larry's Post Co. v. Unemployment Ins. Division, 238 Mont. 190, 777 P.2d 325 (1989) "Perhaps the most important indication that [employer] retained control over the woodcutters was the fact that the relationship between the two was terminable at will without liability on the part of either party. This fact signified the existence of an employment relationship."

American Agrijusters Co. v. Montana Department of Labor and Industry, 1999 MT 241, 296 Mont. 176 The power to fire is the power to control. The absolute right to terminate the work relationship without liability is inconsistent with the concept of independent contractor, pursuant to which the contractor should have the legal right to complete the project under contract and to treat any attempt to prevent completion as a breach of contract.
Walling v. Hardy Construction, 247 Mont. 441, 807 P.2d 1335 (1991) Independent contractor status was indicated where general contractor of school construction project could not "fire" concrete sub-contractor without terminating written contract and incurring liabilities. Fact that contract gave general contractor the right to fire employees of the concrete sub-contractor did not negate independent contractor status where sub-contractor himself could not be "fired" from project without contractual ramifications.
Schrock v. Evans Transfer and Storage, 225 Mont. 348, 732 P.2d 848 (1987) Driver for trucking company, who was furnished truck and could be terminated by trucking company for failing properly to maintain equipment, was employee because he was not in fact free from control of trucking company, despite existence of contract purporting to establish independent contractorship.
Solheim v. Tom Davis Ranch, 208 Mont. 265, 677 P.2d 1034 (1984) Larson quoted that "the one element of right to fire, with its attendant implied right to control, has carried the day for employment relationship." Independent contractor status not defeated, however, even though rancher could have terminated hauling relationship, where there was no indication rancher could have stopped trucker in mid-route and replaced him with a different driver.
Sharp v. Hoerner Waldorf Corp., 178 Mont. 419, 584 P.2d 1298 (1978) Company's right to terminate janitorial worker for any reason was strong indication of employment status because the right to terminate the relationship without liability is not consistent with the concept of independent contractorship.
 
MONTANA WORKERS' COMPENSATION COURT DECISIONS
Colmore v. UEF/Forgey [3/4/04] 2004 MTWCC 22 Where the agreement for the hired worker provides that the hiring party will designate work on an “as-you-go” basis, the agreement in essence allows the hiring party to terminate the agreement at will and such an agreement is more consistent with an employment relationship than one of independent contractor. (Note: WCC affirmed in part, and reversed in part, on other grounds in Colmore, et al. v. Uninsured Employers' Fund, 2005 MT 239.)