What are the risks associated with Dynamex and independent contractor misclassification in San Diego? The rules of the business game have significantly changed in California based upon the landmark Dynamex decision handed down by the California Supreme Court earlier this year.
Many San Diego businesses use independent contractors instead of hiring workers as employees. This has provided businesses of all sizes with the ability to deliver products and services to San Diego and California markets in a more cost-effective and competitive manner. The overhead costs and management complexities are much different for independent contractors than employees.
That all changed in April of this year. The Dynamex decision has forever changed the ability of any company to utilize independent contractors in place of employees. No one wants to hear or believe this news. However, any employer or business owner who attempts to ignore the implications of Dynamex and stick their head in the sand will face huge financial costs and penalties which cannot be overstated. The misclassification of an employee as an independent contractor can and will literally threaten the financial viability and life of your company.
Many businesses have already been forced to close and file for bankruptcy protections after decisions handed down by the California EDD, Labor Commissioner, IRS or other state or federal tax or employment-related agency.
Dynamex establishes a new and profoundly game-changing presumption in California:
All workers in California are legally presumed to be employees unless the employer can prove the status of an independent contractor with the new A-B-C test.
The vast majority of independent contractors in California will not pass this test. What does Dynamex and independent contractor misclassification in San Diego and across California mean for your business? We invite you to download our new Watkins Firm Dynamex White Paper and contact us or call 858-535-1511 to begin a conversation about your business and the impact and risks associated with Dynamex and independent contractor misclassification in San Diego.