New Ninth Circuit Ruling Applies Dynamex Decision Retroactively – Making It Hard to Say Workers aren’t Employees

The San Francisco Chronicle reported on May 2, 2019, that the California Supreme Court Dynamex decision can be applied retroactively. Dynamex changed the rules in the new gig economy – the sector of the economy that uses apps to help drive business while giving workers flexible hours.

Both the Dynamex decision and the 9th Circuit’s retroactive decision affect companies such as Lyft and Uber which have consistently tried to hold that their workers are independent contractors and not employees. Workers claim that companies like Uber and Lyft control their work, such as dictating which passengers the workers must accept. Control indicates an employee relationship.

The difference between employee status and independent contractor status is critical. In can affect many employment issues including:

  • Minimum wage requirements
  • Overtime pay
  • Other possible wage and benefit areas

The case before the 9th Circuit was Vazquez v. Jan-Pro. Jan-Pro is a company that hires people to clean office buildings. The decision hinged on whether Jan-Pro should be classified as a franchise or a cleaning company. The District Court Judge, according to the San Francisco Chronicle, applied the ABC test set forth in Dynamex.

A. The workers were controlled by Jan-Pro
B. The workers “did work central to Jan-Pro’s business”
C. The workers did not have independent businesses of the same nature as the work performed

The District Court judge who made the initial ruling was also persuaded that Jan-Pro earned a percentage of the payment that customers paid for the cleaning work and that Jan-Pro’s business relies on someone else doing the cleaning.

The ruling is expected to help other workers in the gig economy and other economic sectors. The decision reinforces, in California, that – for wage law purposes – “workers who provide services in a company’s usual course of business are that company’s employees.”

The case could affect numerous workers across California.

The state of California is considering a new bill which would codify the Dynamex decision – and even expand worker’s rights. The law could force many companies to classify their workers as employees and not independent contractors.

Workers who work in the gig economy and believe they are being underpaid or don’t know what their employee rights are – should seek the help of the experienced employment lawyers at the California law offices of Stephen Danz & Associates. We have numerous convenient offices across the state. To learn your rights, call us at (877)789-9707 to schedule an appointment. Se Habla Espanol.