Articles Posted in misclassification

With the stroke of Gov. Gavin Newsom’s pen, the sweeping California employment law limiting businesses’ use of independent contractors has become law and will go into effect Jan. 1, 2020. employee misclassification

Assembly Bill 5 had the overwhelming support of the state legislature, and the governor’s signature was widely anticipated, as his office had already voiced support for the measure.

Orange County employment lawyers know the goal is to reduce instances of worker misclassification, which is when employees are improperly designated as “independent contractors” rather than “employees,” which deprives them of a host of basic protections afforded to employees, such as:

  • Minimum wage;
  • Sick days;
  • Health insurance benefits;
  • Meal breaks;
  • Rest breaks;
  • Workers’ compensation insurance.

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Rideshare companies may compete fiercely on the road, but when it comes to classifying drivers as employees, they are rock-solid united. The CEOs of Uber and Lyft penned an opinion-editorial in the San Francisco Chronicle voicing opposition to a new California law that would re-designate their drivers from independent contractors to employees – with all the actual legal benefits and bargaining rights that entails. Los Angeles employment lawyer

The company has long been extremely reticent to classify these workers as “employees,” arguing their business model is unique in that it merely connects riders to customers, and is not a traditional “transportation company.” It owns no vehicles, drivers have no direct supervision and drivers are free to set their own hours, types of vehicles/services. The company does, however, insure drivers and provides a host of standards and criteria workers are required to meet.

However, Assembly Bill 5 – a broad piece of legislation that will become law if it gains the vote of the state senate as well as Gov. Gavin Newsom’s signature – would expand the definition of “independent contractor” to more closely match that which was outlined in last year’s California Supreme Court decision in Dynamex Operations West Inc. v. Los Angeles Superior Court. Continue reading

Tech giant Google is facing down the real possibility of a massive contractor misclassfication lawsuit that underscores just how pervasive this problem truly is.

Workers who are wrongful classified as contractors rather than employees are missing out on hundreds, thousands or even tens of thousands of dollars in wages and benefits, including overtime compensation, travel reimbursement, benefits like vacation time and sick leave and various kinds of insurance coverage. All the protections laid out in California’s wage and hour statutes – those only apply to employees. But of course – that’s exactly why it’s so pervasive, as it’s the company that classifies the workers – and many have long gotten away with it. employee misclassification

Google happens to be huge and high-profile, so the sheer volume of workers potentially involved is substantial. But Los Angeles employee misclassification lawyers know this problem is far from limited to large, international corporations. It’s true that industry giants like Microsoft, Lyft and Federal Express have had to pay huge compensation to misclassified workers over the years, but we’ve seen it too in mom-and-pop restaurants, manufacturing facilities, local car washes and retail operations.

If there is one good thing to come from the case, it’s that it will raise awareness of the issue. The Economic Policy Institute Estimates about one-fifth of all U.S. companies are currently misclassifying at least one worker. Continue reading

A long-running legal battle with California and Massachusetts drivers for Uber has settled with the ride-sharing tech firm paying a $20 million settlement – but no deal to name them as employees versus independent contractors. Los Angeles employee misclassification attorneys know that has many legal analysts opining Uber was the one that actually won big this round. Los Angeles employee misclassification attorney

The drivers likely acquiesced to this deal, rather than pushing ahead, after a federal appellate court ruled last September that drivers could not join together for a class action, and would instead be required to individually arbitrate each claim. As TechCrunch.com reported, that diminished a lot of the power plaintiffs in that original case had.

As part of the labor and employment lawsuit settlement, Uber has agreed to some other concessions as well. For example, Uber agreed to alter the way it removes drivers from the service, in turn boosting the transparency of the process. In a now-published policy, the tech firm details how it removes drivers from its rosters. The company also plans to institute a means for booted workers to appeal. Drivers will also have the chance to take classes offered by the firm to learn how to improve the quality of rides for customers.

Why Employee Classification Was a Key Issue for Uber Continue reading

When it comes to employee misclassification, the trucking industry was perhaps one of the worst offenders, driven in part by widening profit margins – reducing wages and benefits for would-be workers as well as liability for trucker negligence in crashes. But last year, the U.S. Court of Appeals for the Ninth Circuit ruled in California Trucking Association v. Su that proper classification of commercial drivers per the California’s Labor Commissioner’s Department of Industrial Relations’ reliance on the common law standard could not be preempted by federal law. Los Angeles employee misclassification attorneys know this was a major win for commercial truckers across the state. Now, with the U.S. Supreme Court’s recent declination to hear the California Trucking Association’s appeal of that ruling, it is a win for truckers nationally as well. Los Angeles employee misclassificiation

The case became one of the majority the high court rejects without further explanation (i.e., “Certiorari Denied”). Of the 7,000 or so cases the SCOTUS is asked to review each year, it only accepts somewhere between 100 and 150. (At least four justices must agree in order for the case to be accepted.)

The CTA argued in its appeal that the common law standard used by the state’s DIR was not consistent with certain aspects of deregulation per a 25-year-old federal aviation law. Further, the CTA argued that owner-operator truckers were to be classified as independent contractors, meaning they were paid set rates (not necessarily aligned with minimum wage and overtime hours, etc.) and that the drivers were to be responsible for their own expenses.  Continue reading

Retailers have officially been put on notice by the California Labor Commission: If you hire trucking companies engage in unfair wage and hour practices against truck drivers, you too could be held jointly liable. Los Angeles truck driver wage and hour lawyers understand that to drive home the point, the agency posted a list of firms with outstanding court fines, tax liens and tax assessments can be held jointly and severally liable for future labor law violations committed by those companies. Los Angeles Driver misclassification attorney

The companies in question have been deemed by the commission and/or the courts to have committed wage theft against their workers, failing to pay them what they are owed by law. In many cases, the truck drivers were intentionally misclassified as independent contractors (rather than employees), in turn cheating them of pay benefits like workers’ compensation and unemployment. (This, as well as attempts to shield the firms from liability, which can be expensive, if the drivers are negligent and cause a serious truck accident resulting in someone else’s injury). Additionally some of the trucking companies are accused of failing to pay truck drivers minimum wages, overtime or other expenses.

Misclassification of employees in California is a serious problem, one that widens profit margins for the companies at the expense of everyone else – including and especially the workers. The reason this is illegal has to do with unfair competition. The idea is that these firms shouldn’t continue to pass on that unfair advantage to their retail contractors at the expense of workers and taxpayers. Continue reading

The California trucking industry is one of many heavily scrutinized over its employee classification (or perhaps rather more aptly, employee misclassification). Many truck drivers are identified as independent contractors. Our Los Angeles employment attorneys know the obvious reason for that is trucking is a dangerous job. When truckers are considered “employees,” they must be paid overtime, given state-required breaks and workers’ compensation for injuries. Trucking companies can also be deemed vicariously liable in truck crashes involving negligent employee drivers versus, while they’d have to be found directly negligent in cases involving an independent contractor driver. L.A. employment lawyer

But now, two trucking contractors plus the California Trucking Association are suing the State of California over a mandated test trucking companies must take to ascertain whether a driver is an independent contractor or employee. In federal court, plaintiffs are seeking reversal of an employee-contractor test laid forth in the California Supreme Court in the case of Dynamex Operations West Inc. v. Superior Court of Los Angeles.

As Los Angeles employment attorneys can explain, the state high court in that case adopted the so-called “ABC Test,” to figure out whether a worker is an independent contractor or an employee. That was in April.  Continue reading

Our Orange County employment attorneys in California have long discussed the employment law conundrums for so-called “platform workers” in the “gig economy.” Companies classify the workers as independent contractors, which strips them of key employment rights such as overtime, breaks, liability insurance coverage, minimum wage and workers’ compensation if they’re injured on-the-job. Workers have alternatively argued in a number of cases they are actually employees, entitled to these benefits. Court rulings have varied, and it’s left an increasing number of workers confused about their rights. Harvard and Princeton economists two years ago issued a report saying at that time, some 12.5 million people – 8.4 percent of the U.S. workforce – were considered independent contractors. employment lawyer blog

Earlier this year in the first-of-its-kind ruling, a federal judge in Philadelphia sided with the California-based Uber in finding its limousine drivers are independent contractors, not employees, in the eyes of federal law. The court reached the conclusion after examining the level of control over which the company had over its workers, who were allowed to work any hours they wanted (or not), nap, run personal errands and smoke cigarettes between rides. That decision is being appealed to the U.S. 3rd Circuit Court of Appeals.

The California Supreme Court in April issued a ruling making it more difficult for companies to classify their workers as independent contractors. The ruling has direct implications for the ballooning “gig economy” of platform workers, spurring many companies – and workers – to seek the advice of qualified employment law firms in Southern California. Continue reading

Two former full-time instructors providing services for the General Assembly while employed by a New York-based contractor say they were wrongly classified as independent contractors. The instructors, hired to teach both part-time and full-time courses in fields of technology, business and design, say they were wrongly denied overtime pay, rest breaks and meal breaks – despite working up to 16 hours daily to prepare lessons, grade assignments, meet with students and attend marketing events. As reported by EdSurge, the instructors say they were paid a flat fee, despite working 80 hours each week. In violation of California Labor Code, the instructors allege the company failed to document how many hours they worked and pay them overtime wages accordingly. They represent more than 1,200 current and former instructors who reportedly taught for the firm from 2013 through this year. appleonthedesk-300x225

In March, the judge proposed – and both parties agreed – to a $1 million settlement, which was signed in July and is now awaiting approval from the judge. After administrative and legal fees, there will be about $590,000 to split among the more than 1,200 instructors.

The case is unique for the fact that while we tend to think of the growing “gig” economy as being the primary source of a growing number of California employee misclassification lawsuits, many fields have employed independent contractors and allegedly failed to pay them.  Continue reading

New York State labor review board has made a move that could shake up the gig economy forever. The boardmisclassification lawyers of regulators recently ruled that three former Uber drivers qualify for unemployment insurance, a decision which first requires that the drivers be considered employees in the first place. According to a report from Forbes, the ruling would apply to all “similarly situated” workers, and the board ordered the company pay unemployment insurance benefits on behalf of the drivers.

Gig economy jobs have become popular in recent years, with companies like Uber, Lyft, Grubhub, and a myriad of other delivery and driving services taking the reins and reshaping the economy. Those desperate for a way to make ends meet that also allows for flexibility around an already packed work and family schedule have given these companies a robust labor force. Others who cannot find stable full-time work have thrown themselves into long days and nights trying to earn enough for a full-time wage. Their desperation, along with contractor loopholes, have created a sub-economy where workers are being stripped of many of the protections others enjoy. Turbo Tax-owner Intuit estimated last year that 34 percent of the American workforce is working in the gig economy, with many this year estimating the number to be closer to 40 percent.  Continue reading