Assembly holds informational hearing on California Supreme Court independent contractor case

The Assembly Committee on Labor and Employment held an informational hearing on Tuesday to learn more about the issue of worker classification and the California Supreme Court’s decision in Dynamex Operations West, Inc. v. Superior Court.

The Dynamex case, which makes it more difficult for businesses to classify their workers as independent contractors, has spurred a flurry of activity in the legislature with at least four lawmakers introducing bills aimed at altering the current California law relating to classification of workers as employees or independent contractors.

Recognizing the debate that Dynamex has caused, the committee chair, Assemblyman Ash Kalra (D-San Jose), kicked off the informational hearing by noting that the hearing would not be “the first or last time” the issue would be discussed this legislative session.

Speakers on the first panel – Understanding Worker Misclassification – each had a slightly different focus in their comments, but in broad strokes all spoke to three key points: the negative impacts on low-wage workers of being treated as independent contractors rather than employees, the benefits of the simplicity of the “ABC” test, and the fact that the Dynamex decision itself applies only to wage orders (rather than other purposes for which the employee vs. independent contractor designation is used).

One speaker, UC Hastings law professor Dr. V.B. Dubal, dismissed concerns that have been raised by businesses about how the Dynamex decision will affect independent contractor relationships with white collar workers. “I have talked to people from freelance journalists to moonlighting psychiatrists to truck drivers who say that they are being told that the Dynamex decision means they cannot do freelance work anymore – and that is just not true.”

The second panel, the only to feature employer voices, was led by Jennifer Barrera of the California Chamber of Commerce. Responding to comments from the prior panel, Barrera said “the notion that this is only going to be applicable to wage orders I think is really difficult and challenging from the employer perspective.” Noting the crossover of the wage orders and the labor code, Barrera told the committee that treating an individual as an independent contractor for some purposes and an employee for others is “just an impossible situation that’s actually not going to happen.”

The final panel was dubbed “the employee perspective” on Dynamex, though the panel itself consisted entirely of union representatives. The message of speakers on the third panel largely mirrored that of the first panel. Doug Bloch of the Teamsters characterized the issue of worker misclassification as “an attempt to weaken the bargaining power of workers.” Bloch urged the legislature to “protect and expand this Dynamex ruling, and in doing so, to help protect and rebuild this state’s middle class.”

More than 80 individuals lined up to provide public comment to the committee, many of whom wore buttons bearing the phrase “I am Independent.” Speaking on the issue of how the Dynamex decision will affect newspapers’ ability to hire freelance journalists, CNPA General Counsel Jim Ewert told the committee “if newspapers are required to hire as employees each and every freelance contributor, they will cease using them and those important community voices will be silenced.”

Video of the full hearing is available online through the California Channel.