On January 10, 2024, the U.S. Department of Labor (“DOL”) published its final rule that revises its guidance regarding the standard for assessing whether a worker is an employee or independent contractor under the Fair Labor Standards Act (“FLSA”). The final rule rescinds the DOL’s previous final rule that was published at the end of President Trump’s term of office in January 2021. As we previously reported in the wake of the issuance of the Department of Labor’s October 13, 2022 proposed rule, the final rule returns to a totality-of-the-circumstances analysis akin to the “Economic Reality Test.” This new final rule ultimately has the effect of making it more difficult to classify workers as independent contractors. The new final rule goes into effect on March 11, 2024.Continue Reading The Department of Labor Issues New Final Rule for Independent Contractor Classification
On June 13, 2023, the National Labor Relations Board (the “Board” or “NLRB”) overturned another business-friendly Board decision in favor of a return to a more employee-favorable standard for determining if a worker is an employee or an independent contractor under the National Labor Relations Act (“NLRA”). Independent contractors are exempt from the rights and protections of the NLRA, including the right to form and join unions.Continue Reading NLRB Overturns Standard for Independent Contractor Status Under the NLRA
On October 13, 2022, the U.S. Department of Labor (“DOL”) published its proposed rule regarding the classification of employees and independent contractors under the Fair Labor Standards Act (“FLSA”) in an attempt to resolve inconsistent analyses amongst the Federal Courts of Appeals. The proposed rule would return to a totality-of-the-circumstances analysis of the “Economic Reality Test” (with a few modifications), which would have the effect of making it more difficult to classify workers as independent contractors.Continue Reading The Haunting Return of the Economic Reality Test: U.S. Department of Labor Proposes Resurrecting the Pre-Trump Era Employee/Independent Contractor Test
In a recent opinion in Hill v. Walmart Inc., the Ninth Circuit affirmed summary judgment in favor of Walmart on Hill’s claim for waiting time penalties under Labor Code section 203, finding there was a good-faith dispute about whether Hill was properly classified as an independent contractor of Walmart.
Continue Reading Good Faith Dispute Over Employment Relationship Allows Walmart to Escape Waiting Time Penalties
As we have previously reported, California law utilizes the “ABC” test to determine if workers are employees or independent contractors for purposes of the Labor Code, the Unemployment Insurance Code, and the wage orders of the Industrial Welfare Commission.
Continue Reading Expanding Independent Contractors in California: New Law Awaits Governor’s Signature
In Jesus Cuitlahuac Garcia v. Border Transportation Group, LLC, et al, the California Court of Appeal, Fourth Appellate District has held that the ABC test set forth in Dynamex Operations West, Inc. v. Superior Court, 4 Cal.5th 903 (2018) applies only to causes of action brought under wage orders.
Plaintiff Garcia was a taxicab driver for several years with Border Transportation Group (“BTG”). In 2015, a year after ceasing work for BTG, he sued BTG and two individual defendants for various wage and hour violations.
Continue Reading California Court of Appeal Affirms That Dynamex’s ABC Independent Contract Test Is Limited To Claims Arising Under Wage Orders
Last week, the ridesharing giant, Uber, secured a resounding legal win when a federal judge dismissed a putative class action lawsuit alleging the company violated the Fair Labor Standards Act by failing to pay drivers overtime. The ruling is enormously important, not simply for Uber, but for the growing rideshare technology industry as a whole.
Less than a decade ago, outside of calling a cab company and hoping for the best, the notion of reliably getting from ‘here to there’ via a few button presses on a cell phone was unthinkable. Things have changed. Uber—the now-ubiquitous application that allows patrons to hail various styles of ride—has wholly disrupted the transportation service industry. According to the latest estimates, over 160 thousand Uber drivers dot the roads. Those drivers provide approximately 40 million rides each month, and the company’s 2017 valuation reached $69 billion. The term “Uber” has become a verb (e.g., “I’ll Uber there”) analogous to “just Google it” or “xerox the document.”Continue Reading Uber Drivers’ Class Action Lawsuit Hits Permanent Red Light
Earlier this year, we reported that New York City adopted The Establishing Protections for Freelance Workers Act, also known as the Freelance Isn’t Free Act, (the “Freelance Law”). As explained in our prior blog, under the Freelance Law, a company must: (1) provide a written contract when it contracts with a freelance worker for services worth $800 or more, (2) ensure that all payments to freelance workers are made on a timely basis and paid in full, and (3) prohibit any type of retaliatory or adverse action against freelance workers for exercising the rights granted to them under the Freelance Law.
Continue Reading UPDATE: NYC Adopts New Rules Implementing Freelance Law
The Establishing Protections for Freelance Workers Act, also known as the Freelance Isn’t Free Act, (the “Freelance Law”), which was touted by New York City Mayor Bill de Blasio as the first law in the nation aimed at protecting wage payment rights of freelance workers, became effective last Monday, May 15, 2017. The Freelance Law imposes specific requirements on companies located in New York City that contract with freelance workers, including requiring a written freelance contract, requiring companies to pay freelancers timely and in full, prohibiting retaliation against freelancers who exercise their rights under the Freelance Law, and creating penalties against companies who fail to comply with these requirements.
Continue Reading New Freelancer Law Imposes Additional Requirements For NYC Companies Contracting With Freelancers
At the end August, the National Labor Relations Board released an advice memorandum, originally drafted in December 2015, concluding that a group of drivers who worked for a drayage company called Pacific 9 Transportation were misclassified as independent contractors and that this misclassification constituted a violation of the National Labor Relations Act. This advice memorandum comes on the heels of a handful of Board decisions, which have reached similar conclusions following the Board’s new and expansive definition of who constitutes a statutory employee under the Act, in FedEx Home Delivery & Teamsters, Local 671. 361 NLRB No. 55 (2014).
Continue Reading NLRB Releases Advice Memorandum Affirming Misclassification Constitutes Unfair Labor Practice