When it comes to employment law, we know that California takes violations seriously. That is why you, the employer, do everything you can to follow all laws that regulate your particular business. However, we are learning now that employers may be held accountable for past employee classifications that were not illegal.
Over the last few months, we have seen major changes in the way that the state of California classifies independent contractors. At a time when the “gig economy” is taking off, many regulators are working to redefine when an employer can claim a worker as an independent contractor.
We have discussed why this is a big deal for employers in the state. A large number of workers in California are independent contractors. We see them in every industry, from office jobs to construction, as well as in transportation (Uber and Lyft).
When the state Supreme Court added a more stringent test on whether employers can classify workers as independent contractors, many businesses made changes. However, we are not leaning that another court decision and new guidance from the state’s Division of Labor Standards Enforcement could expand the ruling to go back to previous years. There is also pending litigation that would add workers’ compensation obligations as well.
Could you, as an employer, be retroactively held responsible for the way you classified workers in the past, even if you are properly following the current law?
It looks like that may be the case. A “look-back” period established by the recent court case could put employers on the line for as far back as four years.
Employers who are found guilty of violating workers’ compensation laws by not properly insuring their workers can face a range of consequences. This can include:
You should also be aware that this change could retroactively allow workers who were contractors file personal injury claims against you for any injuries they received. They could claim that they were improperly classified at the time of the injury, putting you on the line for all of their expenses related to their injury.
If you are facing charges of not providing insurance to your employees or for misclassifying workers, please seek legal assistance as soon as possible. These allegations are serious and you can even do time in jail if you are found guilty.
At Sacks & Associates, we have the knowledgeable and experienced team you need to successfully defend you against these allegations. Let us get to work today so you can have peace of mind tomorrow. When you need an uninsured employers attorney, you can contact us for a free consultation by clicking here or calling 310-216-7778.