McClain v. Church
In McClain v. Church, 72 Ariz. 354, 236 P.2d 44 (1951), a real estate broker had not paid unemployment taxes on commissions earned by his salespersons, arguing that they were independent contractors and not performing services for wages.
The supreme court rejected this argument, finding that the salespersons "were employees of the real estate broker under whom they were licensed to operate." Id. at 359, 236 P.2d at 48.
The court reasoned:
The legal right to collect the commission on sales made by the salesmen was in the broker and not in the salesmen. The salesmen were bound to look to the broker for their proportionate part of the commissions. The broker was under obligation to pay the commissions to the salesmen. These commissions were necessarily paid for services rendered. The salesmen therefore were . . . performing services for "wages" which term includes commissions, for the broker. Id.