Employers Cannot Re-Hire or Reclassify Employees as “Independent Contractors” in Order to Save Money Due to COVID-19

California has established a very clear standard for what an independent contractor is, and is not.  Formerly quite narrow, the floodgates of litigation were opened by the California Supreme Court’s decision in Dynamex Operations West, Inc. v. Superior Court, 4 Cal. 5th 903 (2018), which established that (for our purposes here) almost no one is a true independent contractor.  Unless you are something like a house painter, you are almost certainly misclassified as an independent contractor after this case came down in 2018.  Therefore, if your employer recently changed your status to independent contractor in the wake of the Coronavirus pandemic, they are almost certainly acting illegally, and you are going to be owed damages. 

Employers are of course suffering financial hardship due to closures and other economic impacts of the virus, and accordingly are looking to cut costs.  Cutting wages is one of the most attractive ways to do so.  Because independent contractors are not due minimum wages, overtime pay, reporting time pay, expense reimbursements, and other protections afforded by the IWC Wage Orders and the FLSA, simply calling employees independent contractors seems a good way to save money.

This shortcut, of course, is taken at your expense and is completely illegal. If you were recently reclassified as an independent contractor, your employer’s action was almost certainly illegal, and we can help you recover unpaid wages and penalties that will be due to you. 

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