Layoffs, reduced schedules, sick leave, and telecommuting—these are just a few of the issues that employers are navigating as they quickly adapt to the effects of the global pandemic. While moving full speed seems to be the only way to keep up with the rapidly-evolving landscape, companies should take a moment to ensure that they
On February 10, 2020, United States District Judge Dolly M. Gee denied a motion for a preliminary injunction to enjoin California from enforcing Assembly Bill 5 (AB 5) against Postmates Inc. and Uber Technologies, Inc. Judge Gee concluded: “Plaintiffs have not shown serious questions going to the merits — the critical factor in determining whether to issue a preliminary injunction — and, though company plaintiffs have shown some measure of likelihood of irreparable harm, the balance of equities and the public interest weigh in favor of permitting the state to enforce this legislation.”
Continue Reading Court Denies Preliminary Injunction To Halt California’s New Statutory “ABC Test” As To Gig Economy Companies And Drivers
2019 kept US employers on their toes. From intensifying scrutiny of independent contractor relationships, data privacy changes, and hostility to arbitration agreements to continued pressure to examine pay data, increasing employee activism and politically charged discourse in the workplace, it has been a busy year!
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Today California Governor Gavin Newsom signed a landmark bill making it more difficult for companies to engage independent contractors. (See our previous coverage HERE.) Assembly Bill 5 “will help reduce worker misclassification — workers being wrongly classified as ‘independent contractors’ rather than employees, which erodes basic worker protections like the minimum wage, paid sick days and health insurance benefits,” Newsom wrote in a statement.
Continue Reading The Controversial ABC Test From Dynamex Is Codified In Law — California’s Gig Economy Braces For Change
In a much anticipated decision, the National Labor Relations Board (the “Board”) recently ruled in Velo Express, Inc. and Jeannie Edge that misclassifying employees as independent contractors does not violate the National Labor Relations Act (the “Act”). …
Continue Reading A Resounding “No”: NLRB Nixes Argument that Misclassification Violates NLRA
The California State Assembly passes a Bill that codifies the infamous “ABC” test for independent contractor determination — will the Senate follow suit, and will the Governor sign the new legislation into law?
The New Bill
On May 29, 2019, by a 55-11 vote, the state Assembly passed AB 5, a bill that would codify the California’s Supreme Court’s decision in Dynamex Operations West, Inc. v. Superior Court. …
Continue Reading California Assembly Passes Bill Codifying “ABC” Test For Independent Contractor Determination
An update from our neighbors to the north (with thanks to Chris Burkett, partner in our Toronto office):
In January, the Ontario Court of Appeal (in Canada) overturned the lower court’s decision in Heller v. Uber Technologies Inc., 2019 ONCA 1. The Court of Appeal held that an arbitration clause requiring arbitration in the Netherlands of disputes between drivers and Uber to be invalid and unenforceable. Based on the presumption that Uber drivers are employees of Uber, the Court of Appeal found that the arbitration clause was a prohibited contracting out of Ontario’s Employment Standards Act, 2000 (ESA).…
Continue Reading Canadian Court Invalidates Arbitration Clause Requiring Arbitration In Foreign Jurisdiction
On January 25, 2019, the National Labor Relations Board reaffirmed its adherence to the traditional common law independent contractor test for determining whether a worker is an employee or an independent contractor under the National Labor Relations Act.
In SuperShuttle DFW, Inc., the Board expressly overruled its 2014 FedEx Home Delivery decision. In FedEx, the Board drastically reduced the significance of entrepreneurial opportunity in the determination of independent contractor status. FedEx emphasized the right to control factors relevant to the so-called “economic realities” test and gave weight to whether a worker was in fact “seizing” actual opportunities and rendering services as part of their own independent business.
SuperShuttle DFW, Inc. is significant as it abandons the Obama-era standard and gives a boost to companies using contract labor by elevating the importance of entrepreneurial opportunity in the independent contractor analysis. Insodoing, the Board returns the legal framework to its traditional common law roots and adds the examination of entrepreneurial opportunity. The decision suggests that moving forward, the Board “evaluate the common-law factors through the prism of entrepreneurial opportunity when the specific factual circumstances of the case make such an evaluation appropriate.”
With the modern workforce comes modern employment problems. Businesses and workers alike have embraced the “gig economy,” but employment laws were not designed for workforces dominated by independent contractors and freelancers. This disconnect leaves gig economy businesses open to significant liability where such workers should have been classified as employees under the law.
Originally posted in the Daily Journal.
The California Supreme Court recently made a sweeping change to California’s gig economy. In Dynamex Operations West, Inc. v. Superior Court, the Supreme Court ruled that in deciding whether a worker is an employee or an independent contractor, the employer must begin by presuming that the worker is…