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Total Articles: 3

[CA] Independent Contractor Misclassification: The Hidden Trap of Outsourcing

It’s a beguiling option. Companies that classify workers as independent contractors receive a number of benefits, including elimination of payroll taxes, workers’ compensation insurance, and unemployment insurance withholdings. Additionally, independent contractors are not entitled to overtime, double-time pay, or meal and rest breaks. The appeal of classifying workers as independent contractors can’t be questioned.

Governor Brown Signs Bill Making Companies Liable for Employment Violations of Independent Labor Contractor Companies

This weekend, California Governor Jerry Brown signed Assembly Bill 1897. This bill creates new Labor Code section 2810.3, which applies to all but a very limited number of companies with 25 or more employees (i.e., the “client employer”) that obtain or are provided workers to perform work within their “usual course of business” from companies that provide workers (i.e., “labor contractors”).

Reporting New Employees And Independent Contractors

There has long been a requirement for California employers, and out-of-state employers with employees in California, to report the hiring of new employees working in California to the California Employment Development Department’s (EDD) New Employee registry. These reporting requirements were designed to assist the state in locating parents who are delinquent in their child support payments and to assist in the early detection and recovery of Unemployment Insurance benefit overpayments.
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