Tens of millions of dollars have been recovered in lawsuits alleging that employers misclassify employees as independent contractors to skirt government rules on minimum wage, overtime and rest breaks. A 2016 study by economists at Harvard and Princeton universities estimated 12.5 million people or 8.4% of the U.S. workforce were considered independent contractors. However, many workers who are classified as independent contracts are improperly classified and are entitled to damages as a result.
In California alone, the misclassification of workers as independent contractors costs the state roughly $7 billion in lost payroll taxes each year. On April 30, 2018, the California Supreme Court, in Dynamex Operations W., Inc. v. Super. Ct., 416 P.3d 1 (Cal. 2018), decided to curb that wrongful practice. There, two individual delivery drivers, purporting to represent a class of similarly situated drivers, charged that Dynamex, a nationwide package and document delivery company, was guilty of the practice. The Court’s ruling makes clear that many companies in California are improperly classifying workers as independent contractors.
If you feel your employer has wrongfully classified you as an independent contractor to evade obligations under federal and state labor laws, please contact us immediately for a case evaluation.