By Rachel Rabindran, Accounting Consultant

UPDATE—In September, 2019 the Governor signed Assembly Bill 5 that codified the ABC tests used in the Dynamex case to determine when a worker is an employee or independent contractor. In September, 2020 the Supreme Court decided to hear the appeal of Vazquez v. Jan-Pro Franchising International, Inc. to determine if the Dynamex decision can be applied retroactively. See our most recent blog post for more details about how these actions will impact your business: Reclassifying Workers as Employees Under AB 5.

In April, 2018 the California Supreme Court issued their long-awaited ruling in a class action lawsuit concerning delivery drivers. The court unanimously ruled in Dynamex Operations West, Inc. v. Superior Court of Los Angeles County that a worker will be considered an employee of the hiring entity unless the hiring entity can establish all three of the following factors (also known as the “ABC test” to identify independent contractors): (more…)