On 4/30/18 California followed Massachusetts in restricting the ability of employers to classify workers as independent contractors. The California Supreme Court adopted the so-called “ABC” test to determine if a worker is an employee or an independent contractor. Under the ABC test an employer must establish all three prongs of the test or the worker must be classified as an employee. The test requires that the worker:
- must be free from the control and direction of the employer;
- must perform work that is outside the employer’s core business; and
- must customarily engage in “an independently established trade, occupation, or business”.
The court said that a worker may be denied the status of employee “only if the worker is the type of traditional independent contractor — such as an independent plumber or electrician — who would not reasonably have been viewed as working in the hiring business”.
If your business needs help understanding these changes to worker classifications, contact Employee Relations Consultant Susan Daniel.
Susan will also be presenting further on this topic at the Execs breakfast meeting on June 27. If you would like to come as a guest, please contact our Director, Shirlee Johnson.