Home > Legislation > New Legislation to Define “independent contractor”?

New Legislation to Define “independent contractor”?

What is an independent contractor?  Presently, Labor Code section 3353 defines an independent contractor as “any person who renders service for a specified recompense for a specified result, under the control of his principal as to the result of his work only and not as to the means by which result is accomplished.”  Independent contractors are a different animal than employees – and workers’ compensation insurance isn’t necessary for independent contractors.

Assembly member Chris Norby (R-72nd Assembly District) introduced Assembly Bill 2373, which would provide a detailed list of factors to consider in determining if a person is an independent contractor or an employee.

Here is the list of factors currently proposed:

“(a)  The extent to which the principal controls and directs the manner and means of rendering the service.
(b)  The extent to which the principal provides training to the person rendering the service.
(c)  Whether the service rendered is integrated into the principal’s business operations.
(d)  The method by which the principal provides recompense.
(e)  Whether a continuing relationship exists between the principal and person rendering the service.
(f)  Whether the principal established the hours of work of the person rendering the service.
(g)  The amount of time required for the person to rendered (sic) the service.
(h) Whether the principal or person rendering the service provides the instrumentalities and facilities necessary for rendering the service.
(i)  The extend (sic) to which the person rendering the service is required to report to the principal.
(j)  The extent to which the person rendering the service has unreimbursed business expenses or investments in the business of the principal.
(k)  Whether the person rendering the service is engaged in a separate occupation or business or makes his or her service available to the general public.
(l)  Whether this kind of service is usually rendered under the direction of the principal without supervision.
(m)  Whether the parties believe they are establishing an employer-employee relationship.
(n)  The length of time for rendering the service.
(o) The extent to which the service pertains to the regular business of the principal.
(p)  The skill required to render the service.
(q) Whether the principal or person rendering the service have a right to terminate their relationship.”

This bill would provide a lot more for attorneys to work with when the question of worker status comes to litigation.  Perhaps the question of workers’ compensation should factor in as well – does the worker have insurance for him or herself?  Does the principal cover the worker?

One thing is certain – clear guidelines are very necessary in this regard.  One could hire a “contractor” to do work, and suddenly the contractor is an employee and the principal is suddenly in breach of the law by failing to insure his or her “employee.”

Categories: Legislation
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