What do truck drivers, home health aides and exotic dancers have in common? The answer is, that like millions of other workers across this country, many are retained as “independent contractors” rather than “employees.” Many of these workers prefer the independent contractor status for its flexibility, including the ability to decide how and when to work and for whom. But a new law recently signed by Gov. Jerry Brown raises a large red flag for entities engaging independent contractors in California because it dramatically raises the ante for businesses found to have willfully misclassified workers.
Under the newly enacted statute — Labor Code §226.8 — any entity that “willfully misclassifies” an individual as an “independent contractor,” when that individual is determined to have actually been an “employee,” faces stiff civil penalties and unprecedented repercussions — all in addition to the existing penalty structure.
