Internal Revenue Service
Revenue Ruling

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 Rev. Rul. 57-79

1957-1 C.B. 323

IRS Headnote

A schochet engaged by a poultry company to slaughter poultry in accordance with the dietary laws on the Hebrew faith is an employee of the company for Federal employment tax purposes in a case in which he was hired through a union agreement, performs his services on the company's premises, and is required to work during prescribed hours on specified days each week.

Full Text

Rev. Rul. 57-79

Advice has been requested regarding the status, for Federal employment tax purposes, of a schochet engaged by a poultry company to perform slaughtering services in accordance with the dietary laws of the Hebrew faith.

The company is engaged in the business of buying and selling live and dressed poultry. A small portion of its business involves the sale of poultry that must be killed in accordance with the dietary laws of the Hebrew faith. To accommodate that particular trade, the company has engaged a schochet to perform such services for it on a part-time basis.

The services of the schochet were acquired through a union and under the terms of an agreement between the company and the union. Under the agreement, which is a continuing one from year to year, the company may employ, as a schochet, any member of the union who is in good standing, and the union will furnish the company the schochet needed in the operation of its business, provided the earnings, working conditions, and working hours are mutually satisfactory. The company may not discharge the schochet without first notifying the union and stating the reasons therefor. If the schochet is ill and unable to work for the company on any day, a substitute schochet will be furnished by the union. The schochet is to be remunerated for his services on a piecework basis.

In the instant case, the company requires the schochet to work on its premises during prescribed hours on three specified days each week. His work is integrated with the work of other employees of the company; however, the company may not require him to perform duties other than those normally required of a schochet. The company does not give him any instructions as to the manner in which he is to perform his services. As is customary in this industry, the schochet furnishes his own equipment needed by him. Also, under the dietary laws of the Hebrew faith, he may reject any poultry which is not acceptable to him. The relationship between the company and the schochet in the instant case has been a continuing one for the past eight years.

On the remaining three days per week, the schochet holds himself out to undertake similar work for others and, in that undertaking, operates from his own home.

It is contended that the schochet is not an employee of the company, for Federal employment tax purposes, for the reason that the company does not supervise or control the schochet's services.

Section 3121(d) of the Federal Insurance Contributions Act (chapter 21, subtitle C, Internal Revenue Code of 1954) provides that the term `employee' means, among other things, any individual, who, under the usual common law rules applicable in determining the employer-employee relationship, has the status of an employee. The guides for determining whether, under such rules, an employer-employee relationship exists are found in section 31.3121(d)-1(c) of the Employment Tax Regulations.

The position occupied by a schochet in establishments such as that operated by the poultry company in the instant case is not, aside from the religious factors involved, materially different from that occupied by individuals, admittedly employees, who customarily perform slaughtering services in establishments which do not deal in kosher poultry. Although, under the agreement with the union, the company does not have the right to choose or select its own schochet and may not require that the schochet perform services other than those normally performed by a schochet, the services of that individual have been rendered during prescribed hours on three specified days each week, on the company's premises, and constitute a necessary incident to the conduct of the company's business. Thus, by the nature of the services and the circumstances under which they are performed, the company necessarily retains an implied right to direct and control the schochet in the performance of his services, although it may not actually choose to do so. The requirement that the company must first advise the union of its reasons, prior to the discharge of a schochet, does not necessarily imply a relinquishment by the company of its right to effect such discharge.

It is concluded that the services performed by the schochet for the poultry company, on its premises and under the circumstances set forth above, are subject to the right of direction and control by the company to an extent sufficient to constitute the company the employer of the schochet for purposes of the Federal Insurance Contributions Act.

This conclusion is also applicable for purposes of the Federal Unemployment Tax Act and for purposes of the Collection of Income Tax at Source on Wages (chapters 23 and 24, respectively, subtitle C, Internal Revenue Code of 1954).

See Rev. Rul. 57-80.