Role of Directors. The board of directors of a property management corporation in Oregon meets on a regular basis. The company paid the directors $6,000 each in the third quarter of 2003. It did not report the payments as part of its payroll and did not pay unemployment tax on the payments. The Oregon Employment Department contended that the company owed

$700 in unemployment taxes on the payments to the directors.

The company protested. The administrative law judge

(ALJ) for the Employment Department held that the company owed the taxes because directors’ fees are the same as wages for employment. The company appealed. The court of appeals affi rmed the ALJ’s ruling. The company appealed again. Are payments to directors the same as wages for tax purposes?

Explain. [Necanicum Investment Co. v. Employment Department, 345 Or. 138, 190 P.3d 368 (2008)]