Court Gives Green Light To Worker Misclassification

This summer, the California Supreme Court made it easier for workers bringing employment misclassification claims to obtain class certification. The ruling benefits claimants bringing misclassification (independent contractor vs. employee) claims in California courts.

Four newspaper carriers for the Antelope Valley Press brought the underlying lawsuit against the paper, alleging that it illegally classified them as independent contractors rather than employees, thus depriving them of broad wage and hour protections to which they are legally entitled. The complaint alleged unpaid overtime, unlawful deductions, failure to provide breaks, and failure to reimburse for business expenses, among other statutory and wage order violations. The carriers sought class certification, which the trial court denied on the basis that “common issues” among the proposed class members “did not predominate.” The trial court found that resolving the carriers’ employment or independent contractor status would require “heavily individualized inquiries” into the newspaper’s control over the carriers’ work.

The supreme court held, however, that the trial court bypassed the relevant question—that is, whether the newspaper’s scope of the right of control is susceptible to classwide proof—and focused too much on the substantive question of the defendant’s right to control its newspaper deliverers. “The difficulties with the [trial] court’s ruling on class certification thus lie not in the answers given, but in the questions asked.” “[W]hen the supporting reasoning reveals the court based its decision on erroneous legal assumptions about the relevant question, that decision cannot stand.” The supreme court agreed with the intermediate appellate court’s decision to send the case back to the trial court to reanalyze the class certification question under the proper standard.

As a result, in reaffirming the “right to control” test, the supreme court paved the way for innumerable misclassified workers in California to achieve class certification in cases where, though they are classified as “independent contractors,” the workers’ employment conditions are controlled by the employer. The answer to a class-wide misclassification inquiry, the high court found, will often be found via common proof in the form of contracts governing the relationship, the degree of control by the employer as spelled out in those contracts, and whether such contractual language is common across the proposed class.

The case is Ayala v. Antelope Valley Newspapers. The California Supreme Court’s June 30, 2014 is linked here.