What is an employee under California law?

We are going to spend Tuesday discussing agency law.  The issue comes up in two contexts:  1.  Is a principal liable for the contract entered into by his (or its) agent?  Answer, yes if the agent had authority.  2.  Is a principal liable for the torts of his agents?  Answer, yes if the agent is an employee, maybe (although probably not) if the agent is an independent contractor.

So what is an employee?  That could easily be an entire semester.  The question necessarily includes what is an employer?

The California Supreme Court has recently given us 85 pages of explanation (and history of the issue) of how to figure out whether a person is an employee or independent contractor.

In Dynamex Operations West, Inc., v. Superior Court, 4 Cal.5th 903 (2018), the Supreme Court summarized it with a three part test:

1. Is the worker free from the control and direction of the hiring entity in the performance of the work, both under the contract for the performance of the work and in fact?
2. Does the worker perform work that is outside the usual course of the hiring entity’s business?
3. Is the worker customarily engaged in an independently established trade, occupation, or business of the same nature as the work performed for the hiring entity?

It concluded that it is the employer’s burden to establish all three.  “The hiring entity’s failure to prove any one of these three prerequisites will be sufficient in itself to establish that the worker is an included employee, rather than an excluded independent contractor, for purposes of the wage order.”

 

 

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