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Willful misclassification of an employee as
an independent contractor
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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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