California Independent Contractor Misclassification
In California, some employers misclassify their employees as independent contractors to avoid providing the protections and benefits afforded to California employees. Under California law, a worker is an independent contractor if he or she is (A) free from the employer’s control, (B) is performing duties that fall outside the employer’s usual course of business, and (C) operates a separate business from the employer. This is known as the “ABC Test.”
Free From The Employer’s Control
This means that the employer must prove that the worker is free from the employer’s control in performing the work.
For example, if the employer sets the worker’s work hours/schedule, requires the worker to show up at a particular location daily, requires use of company equipment or uniforms, has training sessions and manuals, or requires the worker to report to a manager/supervisor, the employer may be exercising so much control over the worker that he or she must be classified as an “employee” and not an “independent contractor.”
Job Duties Fall Outside The Employer’s Usual Course Of Business
This means the employer must prove that the worker’s job functions fall outside the employer’s core business in order to appropriately classify the worker as an “independent contractor” under California law.
For example, a company that primarily provides delivery or transportation services must classify its drivers as “employees.” On the other hand, a plumber that is hired to fix the company’s toilets would be classified as an independent contractor rather than an employee, since the company’s usual course of business has nothing to do with plumbing.
The Worker Typically Operates a Separate Business from the Company
This means an employer must prove that the worker is “customarily engaged” in a business, occupation, or trade that is independent from the employer’s company.
For example, someone who only works for the employer or whose sole income is based on performing work for the employer is an employee and not an independent contractor. Under this third factor, the worker is someone who is in business for themselves.
To recap, in order to classify someone as an “independent contractor,” the employer must prove that:
(A) The worker is free from the employer’s control; AND
(B) The job falls outside the employer’s usual course of business; AND
(C) The worker typically operates a separate business from the company.
If you have been misclassified as an “independent contractor,” you may be entitled to minimum and overtime wages, reimbursements, tax contributions, benefits, disability or workers’ compensation coverage, interest, attorney’s fees, costs, and penalties, among other things.