New Laws

Truck Drivers are Employees Not Independent Contractors

In Garcia v. Seacon Logix, Plaintiff truck drivers sued Seacon Logix, Inc. under Labor Code section 2802 for reimbursement of paycheck deductions, contending that they should have been classified as employees, not independent contractors.  The trial court agreed and awarded damages for specified paycheck deductions.  Seacon appealed contending the truck drivers are employees not independent contractors.

Seacon arranged for transportation of cargo from the Port of Long Beach and Port of Los Angeles to warehouses or other facilities. Although Seacon’s drivers initially used to own their vehicles, due to a clean air program, Seacon later provided the trucks to the drivers.  Seacon required the drivers to sign lease agreements for the use of the trucks and deducted lease and insurance payments from the truck drivers’ paychecks.

Employees Not Independent Contractors

The drivers were told when to arrive at work and had to let Seacon know if they were going to be absent. If the drivers declined a delivery for any reason, they would not receive work the following day. assigned deliveries to the drivers and occasionally provided them with maps showing the route to take. The drivers had to call Seacon when they arrived at their destination and completed their delivery, and check in with Seacon numerous times each day, particularly if they were going to be late with a delivery due to traffic or any other reason. The truck drivers did not have separate business licenses or any other source of income while driving for Seacon, and the drivers could not hire other drivers to use their trucks or use the trucks to work for other companies. The truck drivers were not involved with billing Seacon’s customers and did not believe they had the ability to negotiate their payments.

The appellate court agreed that the truck drivers are employees not independent contractors. Seacon controlled the manner and means of the work, despite the fact that the contracts defined the drivers as independent contractors.  In addition to right to control, the court also looked at secondary factors such as:

  • Right to discharge at will
  • The workers were “a regular and integrated portion of [the] business operation.”
  • The work was performed under principal’s direction or without supervision
  • Skill required
  • The employer supplied the instrumentalities, tools, and place of work
  • Method of payment (by the job versus hourly or weekly)
  • Work was part of the principal’s regular business
  • Parties’ belief

The Department of Labor takes the position that, “[t]he misclassification of employees as independent contractors presents one of the most serious problems facing affected workers, employers and the entire economy.”  Uber is currently facing several lawsuits for allegedly it  is misclassifying its drivers.  Employers misclassifying employees as independent contractors face serious consequences, oftentimes ignoring wage and hour laws created to protect employees.

If you or someone you know has a question about how to correct classify workers, contact Robert Nuddleman at 925-400-9052.

Original article by Robert E. Nuddleman of Nuddleman Law Firm, P.C.
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