Kathleen Gallagher and Neil J Wertlieb
Kathleen Gallagher has been practicing law since June 2007 and is Co-Founding Partner of Gallagher Jones LLP, a business and estate planning firm based in West Sacramento, California. She enjoys representing business plaintiffs and defendants in California state and Federal courts. She also enjoys creating estate plans for clients.
Neil J Wertlieb is an experienced transactional lawyer, educator, and ethicist, who provides expert witness services in disputes involving business transactions and corporate governance and in cases involving attorney malpractice and attorney ethics. He is a Founding Member and Co-Chair of the California Lawyers Association Ethics Committee. He is also the Co-Chair of the Business Litigation Committee of the Business Law Section. For additional information, please visit www.WertliebLaw.com.
Below are summaries of several interesting California Supreme Court cases and laws that came out in 2019 related to business issues.
In late 2019, a new law was passed where the Legislature codified the California Supreme Court's 2018 ruling in the case of Dynamex Operations West v. Superior Court.2 This case provided an "ABC Test" for classification of independent contractors. The new Labor Code statute gives the "ABC Test" retroactive effect, but also contains a list of professional exemptions. Workers who fall under the statutory exemptions, however, will still be subject to the classification test and factors identified in the case of S.G. Borello & Sons, Inc. v. Department of Industrial Relations.3
The express retroactive effect given to Dynamex and Borello tests may mean an increase in potential claims against businesses by workers who believe they have been misclassified. Misclassified employees can raise civil claims, including failure to pay overtime wages, failure to provide meal and rest breaks, failure to reimburse for business expenses, waiting time penalties, unfair business practices, and others. These, in turn, can result in significant damages and penalties against employers.
Effective January 1, 2019, California started allowing attorneys not admitted to practice in the State, but in good standing in any jurisdiction in the United States or another country, to provide...
