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Willful misclassification of an employee as an independent contractor


It's about time. California has a bill that will make the willful misclassification of an employee as an independent contractor, a crime. Of course the MCAA is against it. They repeatedly long for the days when courier companies could classify children as independent contractors.





Version: Amended

Version Date: April 19, 2007

Synopsis: An act to add Section 226.8 to the Labor Code, relating to employment.

DIGEST: LEGISLATIVE COUNSEL'S DIGEST

SB 622, as amended, Padilla. Employment: misclassification of employees as independent contractors.

Existing law prescribes comprehensive requirements relating to minimum wages, overtime compensation, and standards for working conditions for the protection of employees applicable to an employment relationship.

This bill would prohibit willful misclassification of employees as independent contractors. The bill would authorize the Labor and Workforce Development Agency to assess specified civil penalties from persons or employers violating the bill. The bill would authorize employees who suffer actual harm [A> OR A LABOR UNION OR ORGANIZATION <A] to bring actions [D> for <D] [A> TO RECOVER <A] these civil penalties.

Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.

Text:
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

SECTION 1. Section 226.8 is added to the Labor Code, to read:

226.8. (a) It is unlawful for any person or employer to engage in any of the following activities:

(1) Willful misclassification of an employee as an independent contractor.

(2) Willful payment of a nonexempt employee at a fixed salary rate where the employer knew or should have known that payment at that rate would result in the employee receiving less wages than he or she would have had he or she been paid based on regular hours and overtime hours worked.

(3) Charging an employee who has been willfully misclassified as an independent contractor a fee, or making any deductions from compensation for any purpose, including, but not limited to, fees or deductions for goods, materials, space rental, services, government licenses, repairs, equipment maintenance, or fines arising from the employee's employment where the employer would have been in violation of the law if the employee had not been misclassified.

(b) If the Labor and Workforce Development Agency or any of its departments, divisions, commissions, boards, or agencies, or a court, finds that any person has engaged in any of the enumerated violations of subdivision (a), a civil penalty of not less than five thousand dollars ($ 5,000) and not more than fifteen thousand dollars ($ 15,000) shall be assessed against the person per violation, in addition to any other penalties or fines permitted by law.

(c) If the Labor and Workforce Development Agency or any of its departments, divisions, commissions, boards, or agencies, or a court, finds that any person has engaged in any of the enumerated violations of this section and there is evidence that the person has engaged in or is engaging in a pattern or practice of these behaviors, a civil penalty of not less than ten thousand dollars ($ 10,000) nor AND NOT more than twenty-five thousand dollars ($ 25,000) shall be assessed
against the person per violation, in addition to any other penalties or fines permitted by law.

(d) Nothing in this section shall prohibit an employee who has suffered actual harm or a labor union or organization that represents that employee from bringing an action ON BEHALF OF HIMSELF OR HERSELF OR on a representative basis on behalf of all employees of the employer who are similarly situated to recover the penalties established in subdivisions (b) and (c).

Sponsor:
Padilla



 

 

 

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