Independent Contractor or Not? Garcia Provides Some Answers for Employers

Home / Archives for Tim ZamaniganLast month, the appellate court in Garcia v. Border Transportation Group, LLC reached an important decision that could give employers some much-needed insight into distinctions between independent contractors and employees. Earlier this year, in late April, the California Supreme Court issued a decision in a case called Dynamex Operations West, Inc. v. Superior Court, which put new standards in place for employers to adhere to in classifying their workers as independent contractors as opposed to employees. In the months since this decision, there’s been a decent amount of confusion and uncertainty over how exactly to abide by these standards and avoid legal pitfalls. Garcia’s recent decision may provide some guidelines to help clarify the new standard. In Garcia, the trial court granted summary judgment for the employer, declaring that plaintiff Garcia was properly classified as an independent contractor. Some of the claims in this case were based on IWC Wage Orders, which establish guidelines for ensuring employees receive minimum wage, overtime compensation, meal and rest breaks, etc. Meanwhile, as the employee’s appeal of this decision was pending, the CA Supreme Court issued its opinion in Dynamex. The appellate court therefore used Dynamex’s reasoning on Garcia’s appeal, and in doing so the employer could not show that the plaintiff had an independently established business…

A Whistle Upon Deaf Ears: Changes to Dodd-Frank Whistleblower Protections

Home / Archives for Tim ZamaniganA Whistle Upon Deaf Ears: Changes to Dodd-Frank Whistleblower Protections On Wednesday, February 21st, the U.S. Supreme Court unanimously ruled that individuals who report allegations of corporate wrongdoing must do so to the Securities and Exchange Commission, not just to their own companies, in order to qualify for protections offered under the Dodd-Frank Act. The case in question, Digital Realty Trust v. Somers, involved Paul Somers, a former employee of Digital Realty Trust, a San Francisco-based real estate investment company. Somers detected foul-play in the company and reported mismanagement of funds and contracts to senior management. He was subsequently fired in 2014. Somers proceeded to sue, claiming that his termination was retaliation that violated the Dodd-Frank Act. Unfortunately for Somers, and other would-be whistleblowers, the Supreme Court disagreed. This decision is contrary to how the Dodd-Frank Act has been interpreted by many lower courts since its introduction in 2010. The Dodd-Frank Whistleblower Program includes payable awards to those who report information that leads to a successful action, as well as safeguards against employer retaliation. Whereas past interpretations offered these protections for those who reported issues internally, the Supreme Court decision suggests that the Act’s plain language limits its protections to specific instances where the individual has reported the violations in…

Cash or Course Credit? Department of Labor Updates Guidelines for Unpaid Internships

Home / Archives for Tim ZamaniganCash or Course Credit? Department of Labor Updates Guidelines for Unpaid Internships The designation between “employee” and “intern” can be a tricky one for employers. Depending on which you’re hiring, you may need to dole out wages and overtime pay. But new changes rolled out by the Department of Labor (DOL) this January could help clarify the dividing line and give employers more flexibility in crafting new positions. Since 2010, the DOL has touted a six-factor test to determine if workers could be considered employees under the Fair Labor Standards Act (FLSA). However, this month the DOL updated their policies to reflect a more commonly accepted methodology: a “primary beneficiary” test, which, as one might guess, focuses on whether the intern or the employer is the “primary beneficiary” of that relationship. The former six-factor test was a strict one which required that all factors be met for a position to qualify as an internship; if not, these interns would be considered employees, and therefore entitled to minimum wage and overtime pay. This was widely considered to be a hard standard to meet, and it became a problem for many employers as a result. Several courts adopted the primary beneficiary test as an alternative method, with the Second Circuit leading the…