Total Articles: 9
Worker Deemed Independent Contractor,Labor Code Claims Denied
Proper classification of a worker as an independent contractor involves careful consideration of a variety of factors. Often the distinction between employee and independent contractor is not black and white. The potential liability of an erroneous decision can be significant, particularly given recent amendments to California law dramatically increasing penalties. Nevertheless, employers often make the correct decision, as illustrated in the recent California appellate court case titled Arnold v. Mutual of Omaha Insurance Company.
New California Law Discourages Independent Contractors and Sole Proprietorships by Potentially Penalizing Businesses that Use Their Services
In the last hours of his opportunity to veto new legislation, California Governor Jerry Brown signed SB 459. Similar to a bill previously vetoed by former Governor Schwarzenegger and dubbed the "Job Killer Act" by business, SB 459, effective January 1, 2012, might be called by some critics the "Small Business Killer Act." Championed by organized labor and supported by Democratic legislators, the practical consequences could prove to discourage businesses from utilizing independent contractors based in California, while also discouraging service-providing sole proprietorships and other independent contractors from providing services to other businesses in California.
California Employers Beware of Misclassifying Workers as Independent Contractors
On October 9, 2011, Governor Jerry Brown signed a new law imposing monetary penalties on employers that “willfully” misclassify workers as independent contractors. S.B. 459 takes effect on January 1, 2012. Employers who violate this law will be fined a civil penalty between $5,000 and $15,000 for each violation. If the company engages in a “pattern or practice” of “willful” misclassification, it will be fined from a low of $10,000 to a maximum of $25,000.
Legal Alert: California's New Law Imposes Stiff Penalties on Employers who Misclassify Employees as Independent Contractors
California's Governor Jerry Brown recently signed into law a bill that will dramatically increase penalties for employers who willfully misclassify employees as independent contractors. The new law compels a $5,000 to $25,000 fine for each violation and also prohibits companies from charging fees or making any other deductions from the pay of independent contractors who have misclassified.
California Rules for Hirer of Independent Contractor in Contractor’s Employee’s Suit Based on Claimed Safety Violation by Hirer
When an employer in California hires an independent contractor, what duty, if any, does the hirer owe to the contractor’s employee injured on the job? Generally, when employees of independent contractors are injured in the workplace, their remedy is limited to workers’ compensation. They cannot sue the contractor or the party that hired the contractor. This applies even where the on-the-job injury is allegedly caused by the hirer’s failure to comply with workplace safety requirements concerning the precise subject matter of the contract between the hirer and the independent contractor, the California Supreme Court has ruled, giving Golden State employers a small victory. Seabright Ins. v. US Airways, No. S182508 (Aug. 22, 2011). By hiring the independent contractor, the Court explained, the hirer implicitly delegates to the contractor any tort law duty it owes to the contractor’s employees to ensure the safety of the specific workplace that is the subject of the contract.
California Supreme Court Limits Employer Liability to IC's Employees
Typically, when an organization hires a vendor / independent contractor, the hiring organization is not liable to the vendor's employees when something goes wrong. The vendor/contractor is the "employer" responsible to its own employees.
Independent Contractor Update: Drivers Are Employees Despite Independent Contract.
When it comes to making some kinds of workers independent contractors, the old saying about putting lipstick on a pig comes to mind. Sometimes an employee is an employee no matter how he is dressed up to look like an independent contractor. A transportation company found this to be the case in a recent decision published by the federal Ninth Circuit Court of Appeal.
Drivers Are Employees Despite Independent Contract.
When it comes to making some kinds of workers independent contractors, the old saying about putting lipstick on a pig comes to mind. Sometimes an employee is an employee no matter how he is dressed up to look like an independent contractor. A transportation company found this to be the case in a recent decision published by the federal Ninth Circuit Court of Appeal.
Independent Contractors Update: Worker Deemed Independent Contractor; Wrongful Termination Claims Fail.
One of the advantages of hiring properly classified independent contractors is that they have no standing to file employee lawsuits alleging wrongful termination, certain discrimination claims, and other causes of action that are dependent on employee status.
