AM I AN INDEPENDENT CONTRACTOR OR EMPLOYEE?

Many employees, including sales people, are misclassified as independent contractors or exempt employees. Exempt employees are not entitled to meal or rest breaks. Independent contractors do not enjoy most of the protections under the California Labor Code. Exempt employees are exempt from overtime, meal, and rest break laws because a legal determination has been made they are not the type of employee who receives those protections.

Over the years our firm has seen many abusive situations in which employers create all sorts of alleged explanations why a worker is an independent contractor, but they are not. We have seen sales people whose hours are set by the employer classified as independent contracts. Workers whose hours are set by the employer, and work on the employers’ premises are employees and not independent contractors. The ability to discipline for failing to follow employers’ orders, rules, and work priorities are also signs an employee and not an independent contractor. The existence of a contract, or the words in the contract, are not dispositive of whether a worker is an employee versus independent contractor.

In order to assess whether you are an independent contractor, consider whether:

1. You work on the employer’s premises
2. You use the employer’s equipment to do your work
3. The employer sets your schedule (start and stop times and number of hours per day)
4. You are disciplined if you decline to work as requested by the employer
5. You do the normal business of the employer is engaged in. For example, you are not coming in to repair a piece of equipment that rarely breaks, or providing IT assistance when needed but are delivering newspapers for a newspaper company

Improper treatment of an employee as an independent contractor leads to several remedies for the employee. These remedies include:

1. A monetary fine to the employer for improperly classifying an employee as anindependent contractor
2. Back pay at minimum wage for ever hour worked for each pay period the employee’s commissions paid to them did not equal minimum wage for that pay period
3. Potential overtime and double time pay
4. Fines to the employer for not properly giving employees written sales commission contracts
5. Penalties payable to the employee for the employer not properly itemizing why the employee was paid what they were paid on their paycheck

Employees Get Minimum Wage

Disreputable employers play the misclassification game in order to avoid the payment of minimum wage and overtime. The misclassification of a worker as an independent contract avoids the requirement employers must pay overtime, minimum wage, reimburse expenses, or regularly pay the employee. Nor do real independent contractors enjoy the benefits of the workers compensation system.

Contact our experienced labor attorneys at 1-877-525-0700 if you believe you were misclassified in order to avoid paying you wages.

Do Sales People Earn Overtime?

Outside sales people may not be entitled to overtime, or minimum wage. Only a qualified labor lawyer can answer questions about whether an outside sales person may truly be an outside sales person under California labor law. Some of the factors to look at concern whether the employee predominately works in the field selling, and whether those duties are selling opposed to customer service. Predominately clearly means 51% or more, but does it mean 50.000001%? How does an employer measure these percents, and what is the significance of an employer’s expectations the employee primarily work in the field selling opposed to an employee actually doing so?

Employees cannot refuse to carry out the employer’s directive and work in the field selling 51% of the time, and then claim overtime. For example, if an employer hires a salesman to sell in the field and gives the salesman a desk in a retail bank the salesman decides to sit at all day and never go into the field the salesman who is fired for refusing to go into the field at least 51% of the time cannot legitimately claim minimum wage or overtime violations.

Most legal determinations whether an employee is an outside sales person are factually based. This means the employee’s job duties, where the job takes place, and the employer’s expectations must be considered. A detailed discussion with an experienced California wage and hour lawyer will help ferret out whether the employer’s classification is correct.

Our experienced labor lawyers can be reached at 1-877-525-0700 if you have any questions about being improperly paid, or being misclassification as an independent contractor.