Hello, dear readers!

Your humble blogger brings you a post today about the wonderful topic of classifying workers as independent contractors vs. employees. Of course, prior to being hurt, many workers jump at the chance of being independent contractors – higher pay, the prospect of deducting various expenses from their taxes, and the ability to take on more than one client at a time… all of these are wonderful things!

But, like an offended child retroactively withdrawing an invitation to his or her birthday party (at the party, mind you), once injured, many workers want to claim that there was no agreement, no meeting of the minds, no basis upon which to rely on someone’s honor or good word.

Unfortunately, California is one of those states that is all too happy to disregard the intent of the parties at the start of the relationship.  Nor is California inclined to force former independent contractors to repay the extra money they were paid as compared to similarly situated employees.

Then again, you have other cases, where the facts suggest that the worker was an employee in everything but name.  Is it any less dishonorable to take a worker who is not sophisticated and educated in employee/independent-contractor classification and undercut competitors by unfairly classifying the worker at the employee’s expense?

In the case of Lozano v. Universal Logistics System, applicant claimed he was an employee and defendant raised the argument that he was actually an independent contractor.  Defendant argued that when applicant-truck-driver got into a traffic collision in 2014, he was carrying a load for defendant as an independent contractor because when he had first started working for defendant in 2006 he provided his own truck and could decline to take on loads.

But applicant testified that these terms changed in 2009 – he could no longer refuse loads and his truck could not comport with the emission laws for the port he visited.  He was apparently paid in his individual capacity and his checks showed deductions for various related expenses, including insurance and administrative fees.

The WCJ found applicant to be an employee, but defendant sought reconsideration arguing that (1) applicant interrupted his interpreter to answer questions, suggesting he didn’t need an interpreter; and (2) applicant’s testimony about who provided him with a vest (presumably one piece of a uniform) conflicted as to whether it was defendant or the Port where deliveries were sometimes made (or originated).

Ultimately, neither issue persuaded the commissioners to grant reconsideration.  The WCJ was rightly afforded a tremendous amount of weight on credibility issues, and given the state of the law and the natural presumption of a finding of employment, there was sufficient evidence in the record to conclude applicant was an employee.

Recall, if you will, that the applicant in Lozano was completely fine with the arrangement until he wasn’t.  From 2006 until 2014 it doesn’t appear there were any real complaints.  And you know how I know? Because he continued to do the job.

The dispute of independent contractor vs. employee is one that comes up with considerable regularity in California, and the defense needs to be prepared to offer thorough and fact-specific evidence of the relationship.  Simply put, mutual agreement at the outset of the relationship is not enough and employers would be wise, if they intend to retain the services of independent contractors, to properly document the relationship and give due regard to the Borello factors.