What is the Definition of Independent Contractor in California?
California employers and employees often want to know: what is the definition of independent contractor in California? More specifically, how does an independent contractor differ from an employee in California? This question and classification can have a lot of ramifications. As just one example, one of our clients recently received a California Labor Commissioner Notice, after a purported employee filed a claim for unpaid wages. Besides contending that all compensation has been paid, the client contends the worker is not an employee, and thus has no right claim unpaid wages in this manner.
In California, the biggest consideration in whether a worker is an “employee” (not an independent contractor) is the “hirer’s right to control how the end result is achieved.” Some amount of “freedom of action” does not convert the worker into an independent contractor, if the employer has “general supervision and control.” Importantly, and contrary to some employer’s beliefs, an agreement labeling a worker as an independent contractor is not binding on their classification.
Besides the control issue, California also poses these questions:
- Does the employer control the manner and means of the worker’s performance?
- Can the employment relationship be terminated at will?
- Does the worker engage in work distinct from the employer’s?
- Is the type of work performed usually done under the employer’s direction or by a specialist without supervision?
- What skill is required to perform the work?
- Does the worker or employer provides the instrumentalities, tools, and place of work?
- What is the length of time for the services?
- Can the worker hire and fire other workers?
- How is the worker paid (e.g., time, piece, rate or job)?
- Are worker’s services part of the employer’s regular business?
- What was the parties intent?
Given the complexity of the inquiry into what is the definition of of independent contractor in California, it’s no wonder that it’s one of the California Department of Labor’s frequently asked questions.
It’s important for California employers to understand that California law often presumes an employment relationship. The burden is on the employer to prove an independent contractor relationship, if that is the goal — and, if so, it starts with the employer showing he has little control over the means/detail of the work.
If the worker is not an employee, then the business relationship is governed by California contract law. For more information on contract and employment issues, contract a San Diego contract lawyer for a free consultation. You can use our contact page, or call 619-535-5151.