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Misclassified as Independent C...

Misclassified as Independent Contractors

In a recent decision, a California court found that a business had misclassified its truck drivers as independent contractors.  Garcia v. Seacon Logix, Inc. (2015) 238 Cal. App. 4th 1476.  While the independent contractor factors are well known, it is important to look closely at cases like Garciain order to understand which facts might place a business at risk of a similar outcome.

In Garcia, the main issue was control.  The court looked to the following facts in finding that Seacon controlled the manner and means of the truck drivers’ work: it controlled when they would arrive at work and required them to call if they were going to be late or absent; absences had to be approved by Seacon and the delivery assignments were tightly controlled; Seacon provided the customers and determined the prices to be charged; during the truck drivers’ workday, Seacon maintained regular contact to monitor the progress of deliveries; and the truck drivers had no choice of assignments, were not allowed to work for another company, and could only use their trucks to work for Seacon.

While the secondary factors also supported the court’s conclusion, it is clear that Seacon exercised (and had the right to exercise) far too much control over the truck drivers.  While such control was conducive to Seacon providing quality and reliable services to its clients, this level of control created a serious risk that a court would find Seacon to be an employer.

Sean Haddad is a business and employment attorney at Appell Shapiro, LLP in Los Angeles, California.

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