It is common in California for employers to – willfully or accidentally – misclassify employees as independent contractors. There are a few reasons employers might do this. Some do it because they just don’t have the right understanding of California’s employment laws. However, others will do it intentionally to avoid their legal obligations to employees.

If you are mislabeled as an independent contractor, you are likely missing out on several rights and benefits that you would be entitled to if you were classified correctly as an employee. The following rules apply to employees only, not independent contractors:

• Employers are required to withhold state and federal payroll taxes for employees
• Workers’ compensation coverage must be provided for employees
• Employees are eligible for unemployment protections
• Employees receive benefits including wage and hour protections, such as overtime pay and minimum wage protections
• Unlike independent contractors, employees are protected under state and federal antidiscrimination laws

How Do I Know If I Have Been Misclassified?

There are several state agencies that conduct different tests to determine a person’s status as an employee or an independent contractor. Which test will apply to you depends on the agency that is interested in your classification.

In April 2018, the California Supreme Court rejected the once-used Borello test in favor of the “ABC” test. To prove a worker is an independent contractor, an employer must prove that:

• The worker is free from the control and direction of the company in connection with the work
• The worker’s tasks are outside the usual course of a company’s business
• The worker is engaged in an independently established trade, occupation or business of the same nature as the work done by the employer

If you believe you have been misclassified and are missing out on the benefits you are legally entitled to, we can help.