So here’s the new “ABC Test” the United States Supreme Court has developed to determine if a worker is an independent contractor:
“(A) that the worker is free from the control and direction of the hiring entity in connection with the performance of the work, both under the contract for the performance of the work and in fact;
(B) that the worker performs work that is outside the usual course of the hiring entity’s business; and
(C) that the worker is customarily engaged in an independently established trade, occupation, or business of the same nature as the work performed.” (Kim Timothy. The Dynamex Decision: The California Supreme Court Restricts Use of Independent Contractors. Labor & Employment Law Blog. May 2018.)
All of the criteria in the “ABC test” must be satisfied for a worker to be considered an independent contractor. If the entire criterion isn’t met, then a worker will be considered an employee in regards to state wage orders. With such a worker-friendly standard being established, what will companies do to hire outside assistance without becoming liable for hiring them like actual employees?
Enter the staffing company!
In the next part of this series, we’ll hear from Joanne Sanders, president of BOLT Staffing, about the impact of the new test on employers and the crucial role staffing companies can play in those situations where an employer does not want to hire more employees.