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Worker misclassification is a situation that arises when a boss, organization or other employer wrongly classifies an employed worker as an independent contractor, either accidentally or deliberately. For workplaces and companies, classifying workers as independent contractors comes with numerous benefits in terms of financial savings and bypassing the need to offer a full employment package. This might include things like wage and working hours protection, standard employee rights such as holiday time and maternity or paternity leave, and the potential to sign up for company health insurance and dental coverage, among other things.
These businesses may attempt to reduce their payroll tax liability by intentionally misclassifying employees as independent contractors, or they may attempt to avoid paying legally mandated overtime by misclassifying regular employees as executives, administrators, or professionals. An employee who is misclassified by their employer may be denied a wide range of benefits that they should be entitled to.
In California, an employee may seek to recover compensation from their employer for misclassification. However, these cases can be highly complex and aggressively defended by employers. At Walker Law, our San Diego misclassification representation lawyers assist victims of employers in reclaiming their rights and benefits. Contact Walker Law today for a free evaluation from our attorneys to help navigate these complex and genuinely risky situations.
When you feel you’ve been misclassified, you have the legal right to seek redress and reclassification, and in many cases, to be appropriately compensated for your previous work performed without the additional benefits provided to employees.
At Walker Law we approach misclassification claims in San Diego with our tested and true approach. Our team will schedule a free 15 minute consultation to understand the specific nature of your case. After that, if both parties agree to move forward with the relationship, we will outline a specific plan on how to improve your situation.
Worker misclassification is unfortunately very common in San Diego. Here a few examples of the claims we handle here at Walker Law:
A common type of misclassification cases deals with independent contractors. Employees and independent contractors are treated very differently under both federal and state law. Independent contractors are not afforded the benefits of non-exempt employees, including:
Under §226.8 of the California Labor Code, employers cannot intentionally or willfully misclassify an employee as an independent contractor. Victims who sue for misclassification representation may be entitled to lost wages and benefits, such as:
Employers who are proven to misclassify their employees on purpose may face civil penalties of anywhere between $5,000 to $25,000 for each violation. Employees who can prove they were misclassified on purpose rather than by mistake may be entitled to “liquidated damages” which is equal to twice the pay of unpaid wages plus interest.
Under the California Private Attorney General Act (PAGA), employees also have the right to file a “PAGA claim” against their employer. PAGA claims allow injured employees to sue their employers for violations of the California labor code. Similar to the idea of a “qui tam whistleblower” claim, a PAGA claim, if successful, allows employees acting as private attorneys general to keep 25% of the penalties collected, with the remaining 75% goes to the state. While the state takes a large portion, having the state on the plaintiff’s side provides numerous advantages and the awarded damages in these cases typically add to a lucrative amount. This recovery is distinct from the unpaid wages to which an employee would be entitled to.
There are two categories of employees: exempt and non-exempt. Non-exempt employees are entitled to overtime pay, a minimum wage, and meal and rest breaks. Exempt employees, on the other hand, must be paid at least twice the minimum hourly wage and have no guaranteed right to breaks or overtime.
Most exempt employees have traditional “white collar” jobs or hold executive positions. They are usually paid on a salary rather than on an hourly basis. Companies can force employees to work more hours while paying them less if they are misclassified as exempt. Exempt employees may be forced to work overtime without paying overtime compensation or forced to work through breaks.
On the flip-side, non-exempt employees who actually do the work of traditional exempt employees may be misclassified so that the employer can retain control/keep someone on with a lowered salary.
Because of the fear of losing jobs in an uncertain economy, many employees tolerate illegal and unethical behavior. Employers who have a strong case for misclassification should take solace in the laws against retaliation. Employees should feel empowered that an employer who takes action against an employee filing a complaint would subject the employer to even harsher penalties.
Unethical employers will try every trick in the book to cut costs and retain control over their employees. At Walker Law Firm, our attorneys stand for a fair and equitable workplace for all employees. We will ensure that your right to get the pay you deserve will be vigorously fought for. Contact our San Diego misclassification lawyers today for your free consultation.