Employee vs. Independent Contractor?

Although we’ve posted about this topic on our blog in the past, it’s worth revisiting due to some recent developments in the law. The distinction between employee and independent contractor is an important one in the context of employment law. As an employee, you’re entitled to a multitude of rights under the Labor Code. As an independent contractor, you’re entitled to none. Many employers misclassify their employees as independent contractors to avoid extending them rights under the Labor Code in addition to avoid paying payroll taxes.

The California Supreme Court’s ruling in Dynamex Operations West, Inc. v. Superior Court of Los Angeles County on April 30, 2018 made it even more difficult for employers to classify workers as independent contractors. A recent appellate court ruling upheld the Dynamex decision, which sets the current law on this issue: A worker is presumed to be an employee, unless the hiring entity establishes each of the following:

(A) that the worker is free from the control and direction of the hiring entity in connection with the performance of the work, both under the contract for the performance of the work and in fact; and (B) that the worker performs work that is outside the usual course of the hiring entity’s business; and (C) that the worker is customarily engaged in an independently established trade, occupation, or business of the same nature as the work performed. (Dynamex, supra, 4 Cal.5th at p. 957.)

If you’ve been classified as an independent contractor by your employer, you may be entitled to compensation. Give us a call for a free consultation regarding your rights!