What Is the Difference Between an Independent Contractor and an Employee in Los Angeles, California?
Under California law, as a general rule, every person who is providing labor or services or working for someone else must be considered an employee rather than an independent contractor, unless the employer can demonstrate that 3 important conditions are met:
- The worker must be free from the control and direction of the company when performing the work, both under the terms of a contract and in fact. This means the worker must not be controlled by the boss in deciding how they do their work.
- The worker must be hired to perform work that is outside the usual scope of the company’s business. For example, if an accounting firm hires an accountant, the accountant will be an employee because they are doing work that is directly related to the work of the firm. On the other hand, if the accounting firm hires a plumber to fix their sink, the plumber would be considered to be an independent contractor because they are doing work that outside of the normal course of the accounting firm’s business.
- The worker must be customarily engaged in an independently established trade, occupation, or business that is of the same nature as the work he or she is hired to perform. For example, a plumber who does plumbing work for a range of clients is considered to be engaged in an independent calling and performing an independent trade and may be classified as an independent contractor.
What if I Signed an Agreement Stating that I am an Independent Contractor, but I May Have Been Misclassified?
An agreement may be evidence that you’re an independent contractor, but it is not definite proof. Under current law in Los Angeles, California you’ll still need to satisfy all other required conditions to be classified as an actual independent contractor. Again, your contract may offer some proof that you are an independent contractor, but just the contract alone does not make you an independent contractor.
If you think that you’ve been misclassified, then consult with a qualified employment law attorney to see if you have a solid claim. If you, along with your attorney, have determined that you have indeed been misclassified, then can file a civil suit in court, file a case with the California Labor Commissioner’s office, or, under certain circumstances, bring a lawsuit on behalf of multiple employees who were aggrieved in the same fashion, seeking a variety of penalties and damages.
What Rights are Employees in California Entitled To?
While some employers misclassify workers because they don’t understand the law, other employers intentionally misclassify workers to avoid their legal obligations to employees. If you’ve been misclassified as an independent contractor, then you’re probably missing out on a wide variety of protections under federal and state law. Among other things, the following rules apply to employees, but not to independent contractors:
- Employers must withhold state and federal payroll taxes for their employees
- Employers must provide workers’ compensation insurance for their employees
- Employees are eligible for unemployment insurance benefits from the state
- Employees are entitled to wage and hour protections, including minimum wage and overtime, and
- Employees are protected under federal and state antidiscrimination laws.
I am an Independent Contractor, But I May Have Been Misclassified as an Employee. How Do I Know?
If some of these examples apply to you, it is likely that you are not an independent contractor but rather an employee, and as such you are entitled to a number of employment benefits and protections.
A company that hires you as an independent contractor should not:
- Instruct you on how to perform the job
- Provide you with training
- Designate managers to monitor your work
- Require you to attend regular employee meetings
- Use forms that refer to you as an employee
- Require you to work on the company’s premises
- Require you to wear a uniform
- Prohibit you from hiring assistants or support staff
- Requires you to take meal and rest breaks
- Require you to follow a specific time schedule
- Prohibit you to work for other companies
- Provide you with company business cards
- Give you a title within the company
- Pay for your licensing fees associated with your profession
- Provide you with the tools or equipment needed to do your job
It’s important to keep in mind that just because one or two of these factors apply to you, it doesn’t necessarily mean that you are an employee. For example, an employer may ask you to work on premises or use their computers for security reasons. Or, you may be asked to attend a meeting that is directly related to the work you are doing for the company.
If you are unclear about your status as an employee, then contact an experienced employment law attorney in Los Angeles, California.
Are Independent Contractors Covered by California’s Overtime and Other Wage and Hour Laws?
A worker who is properly classified as an independent contractor is not going to be covered by California’s overtime and wage laws because those are exclusive to employees.
I Was Misclassified as an Independent Contractor. What Damages am I Entitled to?
There are a wide variety of potential damages that you may be entitled to when you are misclassified. Some of the most common example include lost overtime and unremembered business expenses.
For example, if someone misclassified you as an independent contractor and required you to work 50 hours in a week to complete the work, you would have lost out on 10 hours of overtime, in addition to required meal and rest breaks.
You may have also used your own money to pay for tools, software, supplies, or other items to do your job properly. These are things you can recover from the employer if you file a lawsuit and prove misclassification.
An employer may also face significant penalties for misclassifying employees. For example, claims brought through the Labor Commissioner’s office or through California’s private Attorney General acts could result in the employer paying up to $25,000 in penalties, depending on the nature of the misclassification.
Can My Employer Fire Me if I Report Independent Contract Misclassification in California?
No, you cannot be fired if reporting independent contract misclassification. There are provisions of the California Labor Code that prohibit retaliation and discriminatory conduct for making legitimate employment claims. Employers who violate the Labor Code could face penalties of up to $10,000 per violation.
For more information on the rights of an Independent Contractor vs Employee, schedule an initial consultation with an experienced employment law attorney in Los Angeles, California. Get the information and legal answers you are seeking by calling the Fair Employment Lawyers at Kaplan Weiss LLP (213) 257-8999 today.
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