• AB 5 Signed by Governor!

    Today, September 18, 2019, Governor Gavin Newsom signed Assembly Bill 5 (“AB 5”) which codifies the “ABC Test” established in the landmark case of Dynamex Operations West, Inc. v. Superior Court of Los Angeles (2018) 4 Cal.5th 903 (“Dynamex”). Inter alia, the Dynamex case created the presumption that a person providing labor or services for remuneration shall be considered an employee rather than an independent contractor unless the hiring entity demonstrates that the person (the ABC Test): (A) is free from the control and direction of the hiring entity in connection with the performance of the work; (B) performs work that is outside the usual course of the hiring entity’s business; and (C) the person is customarily engaged in an independently established trade, occupation, or business. Not only does AB 5 codify the ABC Test, but it also expands the scope of the Dynamex decision (which was limited in scope and application to wage orders issued by the Industrial Welfare Commission) to also apply to all provisions of the Labor Code and the Unemployment Insurance Code.

    In addition, AB 5 provides that any statutory exception from employment status or any extension of employer status or liability remains in effect, and that if a court rules that the ABC Test cannot be applied, then the determination of employee or independent contractor status shall be governed by the test adopted in S. G. Borello & Sons, Inc. v. Department of Industrial Relations (1989) 48 Cal.3d 341 (“Borello”). AB 5 provides specific exemptions for specified occupations from the application of Dynamex, and would instead provide that these occupations are governed by Borello. Such exempt occupations include, inter alia, licensed insurance agents, certain licensed health care professionals (physicians, surgeons, dentists, podiatrists, psychologists, veterinarians), certain licensed professions (lawyers, architects, engineers, private investigators, accountants) registered securities broker-dealers or investment advisers, direct sales salespersons, real estate licensees, commercial fishermen, workers providing licensed barber or cosmetology services, and others performing work under a contract for professional services, with another business entity, or pursuant to a subcontract in the construction industry.

    AB 5 will take effect January 1, 2020 and is intended to retroactively apply to existing claims and actions. The passage of AB 5 is indeed a landmark piece of legislation which effectively ends the independent contractor status in California. AB 5 was supported by many as a dramatic improvement for many workers by guaranteeing those workers fair wages and treatment. However, AB 5 is expected to have serious wide-ranging repercussions for California employers, specifically in the gig-economy (Uber, Lyft, DoorDash, etc.) and consumers alike.

    As always, if you have any questions concerning AB5, please do not hesitate to email me at Stephen@mrjclaw.com


  • Handling No Match Letters from SSA

    5/23/19 Handling No Match Letters from SSA Webinar is available on YouTube at https://youtu.be/Xns_CbfeuOM

  • Recruiting Tips for a Tight Labor Market

    05/02/2019  Webinar:  Recruiting Tips for  a Tight Labor Market  https://youtu.be/FiSkc5Sfp9w

  • The Biggest Wage & Hour and Payroll Mistakes

    [03-21-19] Webinar:  The Biggest Wage & Hour Payroll Mistakes.  Listen to our webinar at  https://youtu.be/99xb7lEb5X0

  • Expanding Reporting Time Pay: Paying for a Phone Call

    The California Court of Appeals recently expanded the application of reporting time pay to employees who merely call in to learn if they are required to work and who do not actually physically report to work.

    The case is Ward v. Tilly’s, Inc. (2019) 31 Cal.App.5th 1167.  Anyone who has been to a mall in the last 35 years will recognize Tilly’s as a retail apparel and footwear company.  Tilly’s developed an on-call scheduling practice for Tilly’s retail sales and cashier employees where employees were assigned on-call shifts but were not told until they called in two hours before their shifts start whether they should come in to work.  Historically, these employees did not receive any compensation for having been “on-call”, meaning, if an employee was assigned an on-call shift, called in, and was told the employee should not come in to work, Tilly’s would not compensate that employee for that day.

    The plaintiff, a Tilly’s employee, filed a class action lawsuit against Tilly’s alleging that Tilly’s was required to pay employees reporting time pay for being on-call.  The Wage Orders mandate that employers pay an employee reporting time pay for each day an employer requires an employee to “report for work” but is not put to work or is furnished less than half of the employee’s usual or scheduled day’s work.

    Tilly’s argued that “report for work” means physically being present at the assigned work location and that employees who merely called in to learn about a shift were not reporting for work.  Naturally, being that this is California, the Court of Appeals was presented with an opportunity to get more money to employees and held that an employee can “report to work” by “any manner of reporting, whether in person, telephonic, or otherwise.”  Therefore, each day an employee is on-call and required to call in to learn whether the employee should come to work, the employee must be paid reporting time pay.

    Reporting time pay is half the employee’s usual or scheduled day’s work, but in no event less than two hours of pay and no more than 4 hours of pay.  Reporting time pay is calculated and paid at the employee’s REGULAR RATE of pay, not straight time or base pay.

    This Court’s opinion is thankfully not retroactive.  Nevertheless, California employers must now start paying reporting time pay to on-call employees who merely call in for work or develop a scheduling practice that avoids this type of situation.

    We recommend that all employers contact us to review their scheduling practices and discuss the whether on-call employees should be paid reporting time pay.  Please contact Kurtis Urien at Kurtis@mrjclaw.com for assistance with reporting time pay.

  • Leaves of Absence – Part 2 All Other Leaves

    2/14/19  Leaves of Absence – Part 2:  All Other Leaves webinar available on YouTube at https://youtu.be/h75hlwcN9P8


  • Leaves of Absence, Part I Medical

    Leaves of Absence, Part I Medical webinar 1.16.19 on YouTube at https://youtu.be/LrZ6BbTE5tA

  • Why Can’t I Just Pay Everyone a Salary?

    11/8/18 Why Can’t I just Pay Everyone a Salary?  Listen to the webinar on YouTube at   https://youtu.be/atvk96z5EXY

  • New Laws for 2019 – What you Need to Know. Listen to the webinar on You Tube at https://youtu.be/tUkLkFaxCrY

  • The Future of Independent Contractors