Posted on August 6th, 2019
Below is a complete transcript of this video.
What’s up, fellow entrepreneurs? It’s John Fagerholm again, and today, I want to talk about Dynamex again. I know I’ve beat this case to death when it comes to California law, but it’s just one of those cases that continue to cause problems for people.
Early on with Dynamex, we were seeing a lot more litigation come out of it, and a lot of the existing litigation was being affected by it.
Well, I just got my first labor board decision that included Dynamex, and so now, the Dynamex ruling is spreading over into the labor board realm, California labor board area.
Now, they’re using Dynamex to give out some horrific awards.
Let me just tell you a little bit about this case. It was a client that had a maintenance company, and he had a third party contracted company that took the overflow of the maintenance.
Now, this third party company was a single guy that had his own corporation that did the exact same thing as my client, and when my client couldn’t service some of his clients, then this guy would come in and take over with his company.
Well, over the years, they’ve been doing this probably 10, 15 years or more. Over the years, my client got older and this person was taking over more and more of the overflow.
At some point, they decided that my client was going to sell the business to this third party contractor.
Well, as they were negotiating the terms of it, they just acted as if the deal had already been done.
My client turned over his truck, all of his equipment and everything else, to this third party contractor, and then this third party contractor just started doing the entire route.
Well, shortly into it, as they were negotiating this and nothing had been signed up, the third party contractor got into a car accident that completely wrecked my client’s truck and destroyed all the equipment.
Then, on top of that, he was injured and couldn’t work. Well, guess what he did then? He filed a complaint with the labor board, said, “Hey, I’ve been an employee for the last 10 years, and I need this guy to pay me for not giving me overtime, not getting me lunch breaks and everything else.”
We even had evidence that his wife worked for him, this third party guy. It’s just this crazy case.
I knew it was going to be tough to win anyway, just because of the independent contractor laws, but when I got the decision, which is about a week ago, it was the first time that I had seen anything related to Dynamex appear in a labor board decision, even though Dynamex has been out since last October I think.
Basically, the decision was, yeah, it looks like the guy was pretty much an independent contractor, he had his own company, and everything else, and it just looks like the deal hadn’t been signed and that’s why he’s suing because he got injured and deal wasn’t signed or whatever.
But since Dynamex says that if what you’re doing for your clients is what this third party contractor is also doing for you, then they’re your employees, then for the last three years, you owe them lunch breaks and everything else that an employee’s owed.
Unfortunately, it didn’t go our way, and I think it would have gone our way if it hadn’t been for Dynamex. But just one other thing for California employers to worry about now.
Not only is Dynamex going to affect you in Superior Court, it’s also going to affect you in the labor board.
All right, well, that’s it for today.
Thanks and until next time. Bye bye.
