1. Nesson and Lever install tile for a living. Both worked at Flooring Installation, Inc. until Flooring went out of business in 2022. After that employment ended, Nesson began operating a business called Nesson Tile and Stone. He purchased tools, prepared a bid sheet, and obtained a federal employer identification number for this business. In January 2022, Nesson and Lever each were sole proprietors of their respective businessNesson's business was Nesson d/b/a Nesson Tile Installation, and Lever's business was Lever d/b/a Tile & Stone. Each of these businesses have their own business location. Nesson and Lever entered into an Independent Contractor Agreement dated January 30, 2022. By the terms of the agreement, Nesson's business is characterized as an independent contractor "engaged in providing a business service described as installation of ceramic tile and stone products."

When Nesson does work for Lever, Nesson signs an agreement to do the tile work for a fixed price that includes the materials except the tile itself and labor. The materials, other than tile, would be the grout and all the materials to clean the tile after installation. The reason the tile is not part of the contract is because Leven can buy it in larger quantities and gets a better price.

This issue arises out of an application for unemployment benefits that Nesson filed based on his employment with Lever's business. When Nesson filled out his application, he listed Lever as an employer. Because respondent Minnesota Department of Employment and Economic Development (DEED) had not received wage reports from Lever for Nelson's work, it conducted a field audit to determine Nesson's status with Lever. The field auditor concluded that Nesson was Lever's employee and that Lever owed unemployment taxes on wages it had paid to Nesson.

Lever appealed the determination. Upon reconsideration, the ULJ concluded that Minn.Stat. 268.035, subd. 9,1 applied to the work that Nesson performed for Lever, and reaffirmed the determination that Nesson was Lever's employee. The ULJ applied "the general rules for determining worker status" contained in Minn. R. 3315.0555 (2009). The ULJ concluded that Nesson was Lever's employee, this appeal follows.

You must make a decision whether or not Nesson is an employee based on the following Minnesota rules: You must state whether or not each of the is met, or is not met and why.

A worker doing commercial or residential building construction or improvement, in the public or private sector, performing services in the course of the trade, business, profession, or occupation of the employer, is considered an employee and not an "independent contractor" unless the worker meets all the following conditions:

(1) maintains a separate business with the independent contractor's own office, equipment, materials, and other facilities;

(2) holds or has applied for a federal employer identification number or has filed business or self-employment income tax returns with the federal Internal Revenue Service based on that work or service in the previous year;

(3) operates under contracts to perform specific services or work for specific amounts of money under which the independent contractor controls the means of performing the services or work;

(4) incurs the main expenses related to the service or work that the independent contractor performs under contract;

(5) is responsible for the satisfactory completion of work or services that the independent contractor contracts to perform and is liable for a failure to complete the work or service;

(6) receives compensation for work or service performed under a contract on a commission or per job or competitive bid basis and not on any other basis;

(7) may realize a profit or suffer a loss under contracts to perform work or service;

(8) has continuing or recurring business liabilities or obligations; and

(9) the success or failure of the independent contractor's business depends on the relationship of business receipts to expenditures.

Based on the above facts, give a reasoned opinion on whether or not Nesson is an employee or an independent contractor of Lever's? You must provide a well-reasoned argument and a definite conclusion. (worth 27 points-3 points for each element with a good explanation).