Wycklendt v. Weinberger, 381 F. Supp. 479 (E.D. Wis. 1974)

*480 Michael B. Rick, Hales Corners, Wis., for plaintiff.

William J. Mulligan U. S. Atty., by Joseph P. Stadtmueller, Asst. U. S. Atty., Milwaukee, Wis., for defendant.

MYRON L. GORDON, District Judge.

This is a motion for summary judgment pursuant to Rule 56, Federal Rules of Civil Procedure, on behalf of the defendant Caspar W. Weinberger. The plaintiff has not filed a formal motion for summary judgment, but it is clear from her brief in opposition to the defendant's motion that she seeks such relief. Accordingly, it will be deemed that the plaintiff has filed a cross-motion for summary judgment. I conclude that the defendant's motion for summary judgment should be granted and that the plaintiff's cross-motion should be denied.

The plaintiff seeks old age benefits under § 202(a) of the Social Security Act, 42 U.S.C. § 402(a) (1970), for the period between October 1970 and April 1972. Her claim for these benefits was denied by an administrative law judge on July 26, 1971, and stands as the decision of the secretary. The secretary's denial of benefits is before the court for judicial review and must be affirmed if supported by substantial evidence. 42 U.S.C. § 405(g) (1970).

The record shows the following facts which are deemed to be undisputed for purposes of these motions. Prior to the second quarter of 1970, the applicant, Therese Wycklendt, had completed sixteen of nineteen quarters of coverage required to qualify for old age insurance. During the three quarters of 1970 extending from June to October of 1970, the applicant was employed by her son and daughter-in-law as a babysitter for their four minor children. The applicant cared for the children in her own home while the parents worked on rejuvenating their newly purchased home. The applicant was paid at the rate of five dollars per day; she earned 50 dollars in the second quarter of 1970, 50 dollars in the third quarter of 1970 and 65 dollars in the fourth quarter of 1970.

In order to qualify for benefits for the period between October 1970 and April 1972, the plaintiff-applicant was required to be a "fully insured individual." 42 U.S.C. § 402(a) (1) (1970). Thus, the issue presented for resolution on these motions is whether substantial evidence supports the secretary's finding that the plaintiff's three quarters of babysitting for her grandchildren did not qualify as "quarters of coverage" under 42 U.S.C. § 414(a) (1970). I conclude that substantial evidence supports the secretary's decision.

A "quarter of coverage" is one in which an individual has been paid fifty *481 dollars or more in "wages" or for which he has been credited with 100 dollars or more of "self-employment income." 42 U.S.C. § 413(a) (2) (1970). The record clearly supports the secretary's finding that plaintiff's work could not qualify as "self-employment income." The plaintiff's right to benefits, therefore, rests on the proposition that her earnings in 1970 constituted "wages" under 42 U.S.C. § 413(a) (2) (1970).

"Wages" is defined by 42 U.S.C. § 409 (1970) as remuneration from "employment." "Employment" in turn is defined by 42 U.S.C. § 410(a) (1970) as service performed by an "employee." The act provides that in determining "employee" status, the usual common law rules regarding the employer-employee relationship apply. 42 U.S.C. § 410(j) (2) (1970).

The plaintiff's first contention is that the administrative law judge erred in finding that there was no employer-employee relationship. This contention need not be reached; even if the plaintiff was the "employee" of her son and daughter-in-law, she must demonstrate that her babysitting earnings did not arise from excluded employment. No credit for wages earned can give rise to a "quarter of coverage" if those wages result from "[s]ervice not in the course of the employer's trade or business . . . performed by an individual in the employ of his son or daughter . . . ." 42 U.S.C. § 410(a) (3) (B) (1970).

Although the administrative law judge did not rule on the applicability of § 410 (a) (3) (B), the facts of record can support no other conclusion than that the plaintiff's babysitting earnings must be disregarded under § 410(a) (3) (B) for purposes of establishing a "quarter of coverage." The only dispute over the applicability of § 410(a) (3) (B) is whether child care duties constitute a parent's "trade or business."

It is the plaintiff's position that a parent's child care duties, though not ordinarily compensable, are within the ambit of the term "trade or business" as used in § 410(a) (3) (B). In my opinion, however, Congress intended that term to include only those activities traditionally cognizable as compensable employment.

I have appended to this decision a copy of the ruling of the district court in Loveless v. Weinberger, Unempl.Ins.Rep. [Fed.] ¶ 17, 325, at 2416 (S.D.Ohio 1973). I agree with its reasoning regarding the interpretation of "trade or business" as applied to a parent's child care duties:

"It is true that child rearing has an economic value that can be computed; and that persons do perform the service of child care for economic gain. Nonetheless, at the present time, the economic value of a mother's services in caring for her children are not generally recognized as compensible [sic] or as a trade or business.

". . . Congress has chosen to exclude from coverage under the Social Security Act [in 42 U.S.C. § 410(a) (3) (B) (1970)] certain employment by reason of family relationship. . . . [A] parent may work for his child in the course of the child's trade or business, but . . . may not perform domestic services, whether inside or outside the home, for his children." Loveless v. Weinberger, supra at 2417.

I conclude that the plaintiff's wages for babysitting services cannot be counted toward establishing a "quarter of coverage"; the record adequately establishes the applicability of § 410(a) (3) (B) to the plaintiff's earnings. The secretary's determination that the plaintiff was not a "fully insured individual" as required by 42 U.S.C. § 402(a) (1970) is supported by substantial evidence.

Therefore, it is ordered that the defendant's motion for summary judgment be and hereby is granted.

It is also ordered that the plaintiff's cross-motion for summary judgment be and hereby is denied.

It is further ordered that the decision of the defendant denying old age insurance benefits to Therese Wycklendt for the period between October 1970 and April 1972 be and hereby is affirmed.

[¶ 17,325] Orpha Loveless v. Weinberger, U. S. District Court, S. Dist. of Ohio E. Div. Civ. No. 72-381, 7/11/73.

Family employment exclusion Work for daughter as babysitter. Babysitting services performed by the claimant for her daughter from September to October, 1970, during which time the daughter and her husband were both employed, are excluded from coverage under the Act, and the claimant may not be credited with a quarter of coverage based on such services. While under the present law a parent's work for his child in the course of the child's trade or business may be covered by social security, domestic services for a child are still excluded from coverage. Claimant's argument that the babysitting services were in the course of the daughter's "trade or business" because the first and most important "trade or business" of her daughter was to care for her minor children, is rejected, the court holding that at the present time a mother's services in caring for her children are not generally recognized as compensable or as a trade or business. Back reference: ¶ 10,340.05.

      Memorandum Opinion                 |   Plaintiff filed her present application
          and Order                      | for disability insurance
                                         | benefits on July 6, 1970 alleging
  RUBIN, District Judge: This is         | that she became disabled as of
an action under the Social Security      | June 13, 1970. The application
Act, 42 U.S.C. § 405(g), for review      | was denied on the ground that
of a final decision of the Secretary     | plaintiff had accumulated only 19
of Health, Education and Welfare         | of the required 20 quarters of
that plaintiff is not entitled to social | coverage.
security disability insurance            |
benefits.                                |   A woman who applies for social
                                         | security disability insurance benefits
  This matter is before the Court        | before she attains the age of
on defendant's motion for summary        | 62 is eligible for coverage if she
judgment and plaintiff's                 | has "not less than twenty quarters
cross-motion for summary judgment.       | of coverage during the forty-quarter
                                         | period which ends" with the
    [Lack of Insured Status]             | quarter in which the application
                                         | is filed. 42 U.S.C. § 416(i) (3).
  Plaintiff filed an application for     |
social security disability insurance     |        [Work for Daughter as
benefits on November 10, 1969 alleging   |             Babysitter]
that she had become unable               |
to work as of October 28, 1969.          |   It is undisputed that plaintiff
The application was denied on the        | has accumulated 19 of these 20 required
ground that she lacked the necessary     | quarters of coverage.
"disability insured status" in           | Plaintiff asserts that she earned
that she had only 14 of the required     | the twentieth quarter of coverage
20 quarters of coverage in               | when she worked as a babysitter
the 40 quarter period preceding          | for her daughter from September
the alleged onset of disability.         | to October, 1970. During this period
¶ 17,325                                          © 1973, Commerce Clearing
                                                          House, Inc.

*483
621 8-28-73                          New Matters                       2417
plaintiff's daughter and son-in-law      | the exclusion. In such circumstances,
were both employed. Plaintiff            | the Court must report
babysat in her own home for              | to common usage to determine the
her daughter's two minor children.       | meaning of the phrase "trade or
For purposes of decision only, the       | business." "Trade" is defined in
Secretary assumed that plaintiff         | the dictionary as:
did not perform any services in          |
her daughter's home.                     |     The business one practices or
                                         |   the work in which one engaged
  "Employment" is defined in the         |   regularly: one's calling: gainful
Social Security Act to mean              |   employment: means of livelihood:
                                         |   OCCUPATION.
  any service . . . performed            |
  . . . by an employee for the           |   WEBSTER'S THIRD NEW INTERNATIONAL
  person employing him . . .             |   DICTIONARY
  except that . . . such term            |   (3d ed. 1967).
  shall not include                     |
                                         | A "business" is defined as:
    .   .   .   .   .                    |
                                         |     A usual commercial or mercantile
    (3) (b) service not in the            |   activity customarily engaged
  course of the employer's trade         |   in as a means of livelihood
  or business, or domestic service       |   and typically involving
  in the private home of the employer,   |   some independence of judgment
  performed by an individual             |   and power of decision . . .
  in the employ of his son               |   and sometimes contrasted with
  or daughter. . . .                     |   the arts . . . or professions
                                         |   . . . or sports . . . or
The hearing examiner held that           |   other activity considered less
the services plaintiff performed         |   practical, serious, respectable,
for her daughter during the third        |   or mundane: OCCUPATION,
quarter of 1970 "were services not       |   POSITION, TRADE, LINE.
in the course of the employer's          |
trade or business and, since they        |   WEBSTER'S THIRD NEW INTERNATIONAL
were performed for her daughter,         |   DICTIONARY
are specifically excluded from coverage  |   (3d ed. 1967).
. . ." under the provisions              |
of 42 U.S.C. § 410(a) (3) (A).             | Child rearing is not normally considered
                                         | to be a mother's employment
  Plaintiff argues that her employment   | or means of livelihood. Neither
by her daughter is not                   | is it considered a commercial
excluded by the trade or business        | or mercantile activity. It is true
requirement of 42 U.S.C. § 410(a)        | that child rearing has an economic
(3) (A) because "the first and            | value that can be computed; and
most important `trade or business'       | that persons do perform the service
of plaintiff's daughter . . .            | of child care for economic gain.
was to care for her minor children."     | Nonetheless, at the present time,
                                         | the economic value of a mother's
    [Meaning of "Trade or                | services in caring for her children
          Business"]                     | are not generally recognized as
                                         | compensible or as a trade or business.
  The term "trade or business" is        |
not defined by the Social Security       |   In today' society, a mother often
Act or the regulations adopted by        | has employment outside the home.
the Secretary pursuant to the Act.       | When such employment requires
There are no reported cases construing   | that provisions be made for the

*484
care of minor children, the mother       | child in the course of the child's
naturally seeks the most qualified       | trade or business, but still may
care available. Needless to say,         | not perform domestic services,
her own mother is often the ideal        | whether inside or outside the
babysitter because she is able to        | home, for his children.
render not only competent child          |
care services but to add the love,       |    [Denial of Benefits Upheld]
affection and concern for the            |
child's welfare which is engendered      |   Upon consideration, and for the
by the familial relationship.            | reasons set out above, the Court
But Congress has chosen to exclude       | HOLDS that defendant's motion is
from coverage under the Social           | meritorious, and therefore it is
Security Act certain employment          | GRANTED.
by reason of family relationship.        |
Prior to 1960 this exclusion             |   The decision of the Secretary of
was absolute when a parent was           | Health, Education and Welfare is
employed by one of his children.         | AFFIRMED.
Today a parent may work for his          |
                                         |   This action is hereby DISMISSED.