We all know the independent contractor scene has been dramatically altered in the past two years. First, the California Supreme Court instituted the ABC test in March 2018, then AB5 was passed in October 2019. Now the Labor Commissioner’s Office is acting on those changes by filing lawsuits against companies.
Mobile Wash, Inc. — This Bellflower company was recently sued by the Labor Commissioner’s Office (LC Office) for misclassifying workers as independent contractors rather than employees. The claim is at least 100 workers were misclassified because those workers did not pass the ABC test. In addition, the company is charged with paying those workers less than minimum wage because the workers were not reimbursed for expenses incurred.
As the company name implies, workers went to customer locations to provide services. The workers were required to use their own vehicle (plus buy gas and insurance), pay for their Mobile Wash uniforms, and pay for cleaning equipment and supplies. In addition, the company charged the worker a $2 transaction fee for every tip left on a credit card. The LC Office also found unpaid overtime, rest and meal break violations, and failure to provide paid sick leave.
Uber and Lyft — These two companies have also been sued by the LC Office for misclassifying their drivers as independent contractors and this suit has been extended to cover nearly 5,000 drivers. As above, this case is about monies owed the drivers for minimum wage, overtime, and meal and rest breaks. The LC Office is asking the court to order these companies to stop classifying their drivers as independent contractors.
Using “gig workers” for your business became a big risk in 2018 and continues. The goal of the Labor Commissioner’s Office is to ensure employees are paid every dime owed them and part of that means ensuring workers are properly classified. If you are using anyone you are calling an independent contractor, it’s past time to confirm they will pass any test thrown your way.
Leave a Reply