Cal-Peculiarities: How California Employment Law is Different 2022 Edition

388 | 2022 Cal-Peculiarities ©2022 Seyfarth Shaw LLP  www.seyfarth.com employer/employee.” Id. at 900. Reprising that theme, the Ninth Circuit, in Ruiz v. Affinity Logistics Corp. , 667 F.3d 1318, 1325 (9th Cir. 2012), vacated a judgment for a Georgia-based delivery company whose California drivers, subject to written “independent contractor” agreements, were suing for unpaid wages. The trial court had applied Georgia law, which creates a rebuttable presumption that the contracting parties’ designation of an independent-contractor relationship is true. Id. at 1321. The Ninth Circuit held that California law should apply instead, because even though Georgia had a substantial relationship to the parties, California “fundamental policy” was at stake and California had a materially greater interest than Georgia in resolving an employment dispute arising in California. Id. at 1324. And under California law, the Ninth Circuit stated, “the presumption is that the drivers are employees and the burden is on Affinity to demonstrate that the drivers are independent contractors.” Id. at 1323. The Ninth Circuit then remanded the case for a bench trial, in which the trial court once again ruled for the company. Ruiz v. Affinity Logistics Corp., 754 F.3d 1093, 1095-96 (9th Cir. 2014). In the drivers’ appeal, the Ninth Circuit once again reversed, holding now that the drivers, as a matter of California law, were employees rather than independent contractors: “The undisputed facts indicate that Affinity had the right to control the details of the drivers’ work, and the application of the secondary factors weigh in favor of a finding that the drivers were employees. We therefore reverse the district court’s decision that the drivers were independent contractors and hold that they were Affinity’s employees under California law.” Id. at 1101, 1105. 9 Alexander v. FedEx Ground Package Sys., Inc. , 765 F.3d 981, 988 (9th Cir. 2014) (awarding summary judgment to class of delivery drivers on the basis that they, as a matter of California law, were employees who had been misclassified as independent contractors). 10 Id. at 993-94. 11 Lab. Code § 1454. 12 Duffey v. Tender Heart Home Care Agency, LLC , 31 Cal. App. 5th 232, 242, 245, 250, 253 (2019) (reversing summary judgment for employer). 13 The Restatement Second of Agency § 220 (1958) identifies these factors: (a) the extent of control that, by the agreement, the master may exercise over the details of the work; (b) whether or not the one employed is engaged in a distinct occupation or business; (c) the kind of occupation, with reference to whether, in the locality, the work is usually done under the direction of the employer or by a specialist without supervision; (d) the skill required in the particular occupation; (e) whether the employer or the workman supplies the instrumentalities, tools, and the place of work for the person doing the work; (f) the length of time for which the person is employed; (g) the method of payment, whether by the time or by the job; (h) whether or not the work is a part of the regular business of the employer; (i) whether or not the parties believe they are creating the relation of master and servant; and (j) whether the principal is or is not in business. 14 The California Civil Jury Instructions, CACI 3704, provides: In deciding whether [name of agent] was [name of defendant]’s employee, the most important factor is whether [name of defendant] had the right to control how [name of agent] performed the work, rather than just the right to specify the result. One indication of the right to control is that the hirer can discharge the worker [without cause]. It does not matter whether [name of defendant] exercised the right to control. In deciding whether [name of defendant] was [name of agent]’s employer, in addition to the right of control, you must consider the full nature of their relationship. You should take into account the following additional factors, which, if true, may show that [name of defendant] was the employer of [name of agent]. No one factor is necessarily decisive. Do not simply count the number of applicable factors and use the larger number to make your decision. It is for you to determine the weight and importance to give to each of these additional factors based on all of the evidence. (a) [Name of defendant] supplied the equipment, tools, and place of work; (b) [Name of agent] was paid by the hour rather than by the job; (c) [Name of defendant] was in business; (d) The work being done by [name of agent] was part of the regular business of [name of defendant]; (e) [Name of agent] was not engaged in a distinct occupation or business; (f) The kind of work performed by [name of agent] is usually done under the direction of a supervisor rather than by a specialist working without supervision; (g) The kind of work performed by [name of agent] does not require specialized or professional skill; (h) The services performed by [name of agent] were to be performed over a long period of time; [and] (i) [Name of defendant] and [name of agent] believed that they had an employer-employee relationship [and] (j) [Specify other factor]. 15 See Yellow Cab Cooperative, Inc. v. Workers’ Comp. Appeals Bd. , 226 Cal. App. 3d 1288, 1301 (1991) (“The Supreme Court pointed out in Borello that the Workers’ Compensation Act serves public as well as private interests and that a waiver of its protections is not to be lightly inferred. ‘Among other things, the statute represents society’s recognition that if the financial risk of job injuries is not placed upon the businesses which produce them, it may fall upon the public treasury.’”) (quoting Borello , 48 Cal. 3d at 358). 16 Arzate v. Bridge Terminal Transport, Inc. , 192 Cal. App. 4th 419, 426 (2011) (reversing summary judgment for the defendant; secondary factors could sustain finding that plaintiffs were employees even if control factors indicated that plaintiffs were independent contractors). 17 The FLSA exemption appears in Section 213(d), 29 U.S.C. § 213(d); many states, but not California, adopt the substance of this exemption for purposes of state wage and hour law.