May 15, 2020

1)  If you give someone a title which includes “manager” or “supervisor,” then you don’t have to pay them overtime.

– Wrong. Simply designating an employee as a “manager” or “supervisor” is not sufficient.  The person’s actual job functions must meet the requirements of the exceptions as set forth in the applicable California Industrial Welfare Commission Wage Order.

2)  If you call someone an “independent contractor,” then that’s what they are and the usual employment protections don’t apply.

– Wrong.  Simply calling someone an “independent contractor” does not make it so.  The person and the position must meet numerous specific requirements set forth by the IRS and the California Employment Development Department.  Further, in 2019, Governor Newsom signed Assembly Bill 5 (AB 5) which requires application of the “ABC” test adopted by the California Supreme Court in Dynamex Operations West, Inc. v. Superior Court (2018) 4 Cal.5th 903 to determine if workers in California are employees or independent contractors for purposes of the California Labor Code, the Unemployment Insurance Code, and the Industrial Welfare Commission (IWC) wage orders.  Under the ABC test, the worker can be considered an independent contractor only if the hiring entity satisfies all three of the following conditions:

• • The worker is free from the control and direction of the hiring entity in connection with the performance of the work, both under the contract for the performance of the work and in fact;
  • The worker performs work that is outside the usual course of the hiring entity’s business; and
  • The worker is customarily engaged in an independently established trade, occupation, or business of the same nature as that involved in the work performed.

Although the Dynamex decision gives a road map on how to apply these conditions, they can still be quite confusing and complex in real-life scenarios.  It is best to have a competent employment law attorney assist you in deciding whether to call a worker an employee or independent contractor.

3)  Having a contract with someone in which they are identified as an “independent contractor,” means the person is in fact an independent contractor and the usual employment protections don’t apply.

– Wrong.  Although having a contract helps, the contract alone is not sufficient to cause someone to be an independent contractor.  The person and the position must still meet numerous specific requirements set forth above.

4)  If you have fewer than five employees, you cannot be held liable for discrimination or harassment.

– Mostly Wrong.  It is true that you cannot be held liable for discrimination under the California Fair Employment and Housing Act if you have fewer than five employees.  However, you can be held liable for harassment and retaliation under the Fair Employment and Housing Act with only one employee.  Also, you can always be held liable for violation of public policy under the common law based on a discriminatory or harassing act.  [Gov. Code § 12940(j)(1).]  (The protected areas in California are currently race, religious creed, color, national origin, ancestry, physical disability, mental disability, medical condition, genetic information, marital status, sex, gender, gender identity, gender expression, age, sexual orientation, or military and veteran status).

5)  You cannot be held liable for harassing a job applicant or an independent contractor.

– Wrong.  It is illegal to harass an employee, an applicant, or a person providing services to a contract when the harassment is in any of the protected areas (which are currently race, religious creed, color, national origin, ancestry, physical disability, mental disability, medical condition, genetic information, marital status, sex, gender, gender identity, gender expression, age, sexual orientation, or military and veteran status). [Gov. Code § 12940(j)(1).]

6)  If an employee is salaried, as opposed to being hourly, you do not have to pay overtime.

– Wrong.  Payment of overtime is required as set forth in the various California Industrial Welfare Commission (IWC) wage orders.  Whether an employee is salaried or hourly is not even an element of the test to determine whether an employee is exempt or non-exempt from the requirement to pay overtime.

7)  For non-exempt employees (who are entitled to overtime), you only need to pay overtime if an employee works more than 40 hours in a single week.

– Wrong.  For non-exempt employees, overtime must be paid for any hours worked in excess of 40 per week or 8 per day.  [Lab. Code § 510.]

8)  You don’t have to reinstate an employee following pregnancy disability leave unless the employee had been with you for a year (or some other period) prior to going on leave.

– Wrong.  Employees in California are entitled to reinstatement to the same or a comparable position following pregnancy disability leave no matter how long they were employed by the employer prior to taking the leave.

9)  You only have to guarantee reinstatement if a pregnancy disability leave is six weeks or less.

– Wrong.  A California employee is entitled to up to four months of pregnancy disability leave.  [Cal. Code Regs., tit 2, § 11037.]

10)  An employee cannot take baby bonding leave in addition to pregnancy disability leave.

– Wrong.  A California employee who qualifies for baby bonding leave under the California Family Rights Act is entitled to take 12 weeks of baby bonding leave in addition to the pregnancy disability leave of up to four months (so about seven months in total). The employee is entitled to reinstatement to the same or a comparable position upon her return to work.  [Gov. Code § 12945 and 12945.2.] Further, companies with fewer than 50 employees may still be required to provide its employees baby bonding leave under the Paid Family Leave or New Parent Leave laws.

Need more information?
ESKRIDGE LAW may be contacted by phone (310/303-3951), by fax (310/303-3952) or by email (geskridge@eskridgelaw.net).  Please visit our website at eskridge.hv-dev.com.

This article is based on the law as of the date posted at the top of the article.  This article does not constitute the provision of legal advice, and does not by itself create an attorney-client relationship with Eskridge Law.