How one court ruling can affect the livelihood of two million residents in California.
With the invention of computers and cell phones, the work environment has changed from the formally sought after 9 to 5 to a diversified contractor's paradise. Contractors serve almost every sector of our economy including child care, healthcare, financial services, construction, technology and transportation. Unlike many of us who show up and punch a time clock, contractors set their own hours and can provide a service for multiple clients. California is home to nearly two million residents who choose to work for themselves.
However, a recent California ruling,
Dynamex v. Superior Court
, has called into question the ability of contractors to continue to work for themselves, independently, or if the relationship is an employee-to-employer, where the state regulates the working conditions.
The Dynamex decision created a new test that assumes workers are employees unless:
A) They are "free from the control and direction" of the company that hired them when they perform their work.
B) The work they perform falls "outside the usual course" of the hiring company's business.
C) They have their own independent business or trade beyond the job for which they were hired.
"Dynamex changed its workers' status from employees to independent contractors without a significant change in circumstances. The workers sued to regain their status as employees, and the court agreed. But what may have been an appropriate outcome for Dynamex employees has much broader implications for many different types of independent contractors and self-employed professionals, and jeopardizes the businesses that rely on their services."
President and CEO
California Chamber of Commerce
Because of the potential disruption, the business community is asking the Legislature to immediately limit the court's ruling to the workers directly involved in the Dynamex case and not have the decision apply to other contractors for the next two years.