Dynamex Case

California Broadens Definition of “Employee”
Accounting & Other Professional Firms Affected

Whether you have or not, it will benefit you to read on…

You may or may not know that the Dynamex Operations West Inc. v. Superior Court decision will affect a large portion of your clients.

What you probably don’t know is that there is a good chance it will also affect you as the professional…and it gets worse.

Under this new “ABC Test”, a worker is considered to be an independent contractor only if all three of the following factors are present:

• (A)   The worker must be free from the control and direction of the payor in connection with the performance of the work, both under the contract and in fact;
• (B)   The worker must perform work that is outside the usual course of the Payor’s business; and
• (C)   The worker must be customarily engaged in an independently established trade, occupation, or business of the same nature as the work performed by the worker for the payor.

For example, if accounting is your “usual course of business”, every outside CPA or EA you work with is now considered an employee!

As we mentioned before… it gets worse.

 Just recently, in Vazquez v. Jan-Pro Franchising Int’l, Inc, the U.S. 9th Circuit Court of Appeals decided that the California Independent Contractor/Employee rule change will be applied retroactively.

Stay tuned for our upcoming TRI Minute on this subject.

If you would like to review the Dynamex Case Summary yourself, or if you would like to review the U.S. 9th Circuit Court of Appeals decision, please click the buttons below.

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