July 1, 2025 • 30 mins
Are you actually an employee—but getting paid like a contractor?
In this eye-opening episode of The Glamorous Grind, Ilona and Mila expose the legal gray areas surrounding independent contractor misclassification. From workplace horror stories to California’s ABC Test, AB5, and the Uber & Lyft legal wars, this episode is packed with insight every worker and employer needs to hear.
🎧 You’ll learn:
- What makes someone a W-2 employee vs a 1099 contractor
- Why so many businesses get it wrong—sometimes on purpose
- The real consequences of misclassification (spoiler: lawsuits 💸)
- The truth about gig economy protections under Prop 22
- What to do if you think you’ve been misclassified
- Legal tips for employers, HR teams, and contractors
💼 Whether you’re a startup founder, a freelancer, a gig worker, or just someone clocking 40+ hours a week—you can’t afford to miss this one.
🔊 Red Flag or Green Flag, Glam Tip of the Week, and a raw Q&A from a listener bring the law to life in classic Glamorous Grind style.
Want more glamor during your grind? New episodes every Tuesday. Make sure you are subscribed on YouTube and wherever you get your podcasts.
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Ilona (00:00):
Welcome to the Glamorous Grind where grit meets glamour
and the law is always in style.
Mila (00:04):
Today we're tackling a topic that affects many people
in the workforce themisclassification of employees
as independent contractors.
Ilona (00:14):
It's a practice that denies workers essential rights
and benefits, and, as businessowners, it is important to know
the difference.
Mila (00:21):
And as an employment attorney, this is something I
see unfortunately a lot.
Let's discuss how you canprotect yourself.
Ilona (00:38):
So, mila, before you joined our firm, you worked on
employment defense side for manyyears.
What sort of cases do you seethat are related to employee
status?
Mila (00:47):
Misclassification is very common, where people are
classified as independentcontractors as opposed to
employees, and the problem isthere's no black or white line
right.
Everything is arguable.
There are tests that courts useto determine if someone is
properly classified as anindependent contractor or if
they should be an employee.
(01:07):
A lot of times employers willmisclassify workers.
Sometimes this is accidental.
They don't know any better,especially when it's small
companies, they think they canhave independent contractors.
But other times employers dothis purposefully, honestly,
because it's a lot cheaper.
Why is it cheaper?
It's cheaper because they don'thave to give them insurance,
(01:29):
even though they're working fulltime.
It's cheaper because they don'thave to do payroll taxes.
They don't have to have them onthe payroll.
There are numerous benefitsthat employees get that
independent contractors don'tget.
Ilona (01:47):
Well, I take an issue with it being potentially
cheaper because some people whoare independent contractors they
may be independent contractorsbecause they have a lot of
skills in business and then theycharge more per hour to make up
for the benefits they have tobuy for themselves.
Mila (02:03):
So it's not necessarily cheaper, depending on what field
you're in.
Obviously right, it's reallydependent.
But there are certainsituations when people should be
classified as employees.
They act as employees becausethere are benefits that the law
instills in being an independentcontractor.
But sometimes employers don'tallow the employees to have
(02:24):
those benefits but they stillclassify them as contractors.
Here's the problem.
So when you're an employee of acompany, there are very
specific requirements to be asalaried employee where you
don't get breaks, you don't getlunches, you don't get paid
overtime, you get an hourlysalary.
So under California law thereare very specific requirements
(02:45):
you have to meet to be salaried.
That way the employee doesn'thave to give you lunches,
doesn't have to give you breaks,can work you 15 hours a day and
one of those requirements isyou got to be paid double the
minimum wage.
So if the minimum wage thatgoes up every year, right.
Ilona (03:00):
In California it does Every year.
They're like okay, here's theminimum annual salary, so as
long as you meet that, you'regood.
Mila (03:08):
Well, it's not just that, it also has to be.
There are very specific wageorders that provide which types
of employees can be salariedversus hourly.
So there are like executivepositions are people with very
specific licenses, likeattorneys, who can be salaried
as long as they meet the minimumwage requirement as well.
Ilona (03:30):
What are the juiciest cases you've handled on the
defense side?
Mila (03:34):
I can't say they get that juicy.
If I'm honest, I mean most ofthe time when I was on the
defense side and these casescame through my door I felt very
bad for the plaintiffs, becausethese plaintiffs worked like
crazy hours and they were paidwell under the annual salary
requirement and they wereworking crazy hours, not taking
(03:56):
lunches, working around theclock, and they barely made
enough to survive.
I mean, even with the minimumwage as high as it is in
California, with the cost ofliving so high, you need well
above double the minimum wage tolive comfortably.
And I'm not even talking aboutlive comfortably like you can
afford vacations, I'm talkingabout live comfortably like you
can afford food.
They were misclassified asindependent contractors, barely
(04:28):
paid the minimum thresholds oflike minimum wage if you count
the amount of hours they wereworking, not having any
insurance benefits, like theywould get sick and they can't go
to the doctor.
Ilona (04:35):
You know, the federal minimum wage, I think, is like
$7.
I don't know how people live onthat nowadays.
I mean it's impossible.
Mila (04:42):
Unfortunately, there are people who do work for that
amount because they have nochoice.
It's very sad because and again, I see it from both sides,
having come from the employmentdefense side and representing
employers, I saw employers doingeverything they could, trying
their best to pay theiremployees fairly, but the
(05:03):
minimum wage is so high and theystill have to make a profit.
Ilona (05:06):
Well, here's from an employer's perspective, and you
only learn when you know it'sbest to call an employment law
attorney.
Sometimes, when you want tohire people, they say, hey, can
I get paid as an independentcontractor?
And if you're not aware you canget sued.
That person may be trying toset you up, which happens
(05:27):
sometimes.
There are those people that arelike, oh yeah, I'll take a job,
and then they send you a letterthat's written by an attorney,
and so there are those that tryto set you up, and then there
are those who truly just feellike it's more convenient for
them to get paid as anindependent contractor.
What should employers know todo before agreeing to a request
(05:47):
by a potential employee to be anindependent contractor?
Mila (05:50):
I would recommend no matter how big or small you are
as an employer, you need toconsult with an attorney when
making hiring decisions.
Ilona (05:59):
What if they have an HR department?
Would they know?
Mila (06:02):
They might.
Sometimes the HR departmentshould consult with employment
attorneys.
Here's the problem.
Employment laws change everysingle year and it is impossible
to upkeep with it.
As an HR person Like you needan attorney involved to make
sure that even something assimple as your handbook is
(06:22):
compliant with all of theup-to-date laws.
So I always recommend this.
Employers need to haveattorneys involved.
I don't care if you have totake out a loan.
Consider it an investmentbecause the cost of litigation
in California is so high.
A nuisance value employmentcase in California could be
(06:43):
$50,000,.
Nuisance value that means ifyou get sued by an employee and
you get out of it paying 30grand after litigating the case
and paying your attorneys.
Like you've won.
Employers a lot of times doeverything they can, have the
best intentions and thingshappen and if you're not on top
(07:04):
of it, you will get sued.
That is just a fact.
Ilona (07:08):
Yeah, I mean, in America anybody can sue for anything.
Yeah, that's the reality.
That's why so many lawyers havepractices, good or not, it's
time to get gritty.
Audience Q&A.
Our listener asked thefollowing question hey, I've
been working full-time hours forthis company for over a year
and they tell me when to work,provide all the equipment I need
(07:32):
and I have to report to asupervisor, but I'm still
classified as an independentcontractor.
I receive no benefits.
They don't withhold taxes.
Is this legit?
What should I do?
Mila (07:43):
One of the requirements of being an independent contractor
in California is that theemployer, the company you're
contracting with, does notoversee your work.
You are independent, so you getto set your own hours.
You get to come and go as youplease, you get to make the
calls as to how your work isgoing to be handled and you're
(08:04):
paid on a contractual basis.
But sometimes the employer willbe like no, you have to be in
from eight to five every singleday.
You have to work on ourequipment.
You cannot work remotely andare very controlling over the
contractor's work.
That contractor should be anemployee at that point.
It shouldn't be a contractor.
I'm so excited I finally getthe glamorous flag.
Ilona (08:26):
And they match with your jacket, relatively speaking Okay
, so tell us if this is a redflag or a green flag.
You work for multiple clients,but the employer controls your
workflow.
Mila (08:41):
It depends.
So if you work for multipleclients through the employer,
through the company, and thecompany controls your workflow,
then that's absolutely a redflag because it sounds like the
company you should be anemployee, not an independent
contractor, mostly because theycontrol your workflow.
Now if you have multipleclients and those employers
(09:03):
control your workflow, then it'sa green flag because if you're
able to have multiple clients,even if they specifically
control kind of what you do inthe capacity of your contract
with them, that could be okay,so long as the other aspects are
made, because if you're workingmultiple clients, you probably
(09:23):
are not working full-time eightto five and you have flexibility
.
And then the other issue itwould depend on what industry
are you in versus what industryis the employer in.
Ilona (09:32):
Do you think it's helpful for people who work for
multiple clients to have anindependent contractor agreement
that's written and signed?
For example, they may beconsultant or just kind of go
with the flow and sign a W-9 andI'll pay you per hour.
Mila (09:52):
Oh, always have an agreement.
Always have an agreement.
Always have an attorney reviewthe agreement, Because the other
thing you have to look out forwhen you have multiple clients
when you're working in anindustry is they could have NDAs
.
If you've learned informationfrom one client that you could
potentially use in your workwith another client, you don't
ever want those allegationscoming at you if the two
(10:16):
companies are competing witheach other.
So it's extremely important tohave contracts in place.
Ilona (10:22):
Red flag or green flag, you're excluded from company
meetings and communications,despite doing similar work as
employees.
Mila (10:29):
I would say green flag.
I think it's okay if you'reexcluded from company meetings.
If you're not an employee ofthe company.
If you're an independentcontractor, even if you're doing
similar work, the employer orthe company has no obligation to
include you in company meetingsor internal company events.
Ilona (10:48):
Red flag or green flag.
You're an independentcontractor, but when you come to
the office to do a couple hoursof work, you're dressed in a
miniskirt and as if you're goingto a club showing all your
goodies.
Mila (11:04):
I think it depends.
In some places of employmentmaybe that is acceptable,
depending on the dress code ofthe company.
Ilona (11:14):
I guess I would say If it was in violation of the dress
code of the company?
Should you have an independentcontractor sign off on a dress
code policy for the company?
Mila (11:25):
You certainly don't have to, but the company could make
expectations to you clear ofwhat they expect you to dress
like, and if it's professionalattire, they absolutely have the
right to do that.
Ilona (11:39):
Red flag or green flag.
Have independent contractorsreview and sign off on their
acknowledgement of the employeehandbook that contains the terms
and standards that theemployees are bound by.
Mila (11:54):
I would say probably green flag, because the employer has
the duty to its employees toprotect the employees and a lot
of times those handbooks or alot of those policies will be
relating to harassment,discrimination, retaliation.
So employers could requiretheir independent contractors to
(12:16):
be bound by those policies.
However, there are policies inthose handbooks that contractors
are not going to be bound byMeal breaks, rest break,
requirements overtime.
So you know, if there arepolicies like that, it would be
red flag.
I would say if the employer istrying to get the contractor to
sign off on a handbook in itsentirety, it would probably be a
(12:38):
red flag.
They can't force them to bebound by all of their policies,
but if there are specificpolicies that the employer wants
the contractor to be bound bythat are general, I think that
would probably be okay.
Ilona (12:55):
Let's discuss this.
I know it's a gray area, butwhat if you are a personal
injury law firm with hundreds ofattorneys and they get to
choose whether they want to beindependent contractors or W-2
employees, and if they choose tobe independent contractors, you
still expect them to be at theoffice almost every day?
You give them your computer,all the software and they have
(13:16):
to be at the office X amount ofdays a week.
Would that be amisclassification?
Mila (13:23):
I would say probably.
I know that a lot of law firmsdo this, but technically, if you
are requiring your folks to bein office, if you are giving
them your equipment, they're notusing their own equipment.
If you are controlling the typeof work that they do, they
should be an employee and not acontractor.
Ilona (13:44):
With the rise of the gig economy, worker classification
has become a hot topic and nonefelt it hotter than Uber and
Lyft this year.
Mila (13:51):
Let's do an article breakdown.
Ilona (13:54):
I cannot imagine my life without DoorDash, without
Instacart, because I don't havetime to go and spend two, three
hours at Costco between driveand shopping, and I have to do
that once or twice a week.
And I'm so grateful that thesegig jobs exist because one I
don't have to go to.
(14:14):
These people make extra moneyand can support their families.
And it's just very convenient.
Mila (14:21):
So the issue was in about, I believe, 2019,.
85 came out that said that allthese Uber and Lyft drivers have
to be classified as employees,not independent contractors.
And Uber and Lyft fought thebill saying A our folks want to
be independent contractors, notemployees, because they like the
(14:42):
flexibility.
They don't want to be full-timeemployees or part-time
employees.
And B we don't have thecapacity to oversee these folks
as employees.
We don't have the capacity togive them health insurance, to
give them lunches and breaks anddo all of the administrative
work that goes into that Plusthat's going to increase the
cost for all users.
Oh, absolutely.
I mean and that was one oftheir arguments too the reason
(15:03):
why we can keep the cost down isbecause they're independent
contractors and we don't have topay for employing these folks.
So then they fought it and theybasically said we're going to
leave California and not dobusiness here if this continues.
So then Prop 22 was passed,said that they could be like
(15:24):
specifically for gig driverssuch as Uber, lyft, instacart.
They could be classified asindependent contractors even
though technically under the law, they should be an employee.
Ilona (15:36):
I think that's great.
It's a win for Californians.
One we get to have all thoseconvenient services.
Two for the citizens of ourstate to have that extra income,
especially for single parentsand those sharing custody.
Mila (15:52):
Yeah, no.
And the funny thing is Iremember being on the defense
side when all of that stuff washappening and I was like this
doesn't really benefit anyone.
It doesn't benefit workers.
If they can't have theflexibility A and B, then it's
going to be more expensive forthe consumer and they're going
to have to actually like applyfor work, as opposed to right
(16:12):
now they just sign up.
Ilona (16:14):
As long as they have good reviews on the app, they can
pretty much get the job and thestate can still control how much
taxes they collect because Uberand Lyft will issue 1089 to
those people, and the workerswho are independent contractors
may qualify for cheaper healthinsurance through Covered
California, which could costless sometimes than what their
(16:36):
premium would be through anemployer.
Mila (16:38):
And you know, like a lot of immigrants, they come to this
country.
They don't speak English.
What can they do?
I mean a lot of my uncles.
When we first came to thiscountry, most of them were taxi
drivers, but then, when Uber andLyft came out, they all went to
Uber and Lyft, even though theywere barely able to utilize
technology.
It just made a lot more senseto do Uber and Lyft than it was.
(16:59):
And I remember, even like withthe taxi drivers, it was so
inefficient because you have towait for a fare and they would
just sit around at these cafeslike waiting, whereas Uber and
lyft they set their ownschedules.
They turn on the app wheneverthey want to do work, they come
out to downtown and they, youknow, bid on the work and it
just makes sense for everyone.
Ilona (17:18):
I thought that the cabs will now be cheaper because uber
and lyft are a competition.
So recently when I traveled, Itook a cab from the airport last
.
To get to the airport from myhouse, I paid 60 bucks for using
Uber.
To get back using a taxi fromthe airport, I paid $160 plus.
(17:39):
Then tip on top of it and I waslike what?
I was surprised that it was waymore expensive.
I thought you know, they had tocompete and it would be about
the same, but it wasn't.
Mila (17:47):
I'm surprised taxis are still in business with Uber and
Lyft employees.
So yeah, I mean we'll see howit turns out.
But basically the lawsuit isthat the drivers who worked for
Uber and Lyft want back pay forthe time between AB5 went into
effect before Prop 22 was passed.
Ilona (18:05):
Let's decode the legal criteria that distinguish
employees from independentcontractors.
What's the ABC test and what'sAB5 got to do with it?
Mila (18:14):
The ABC test.
This is the primary test usedin California to determine if
their worker is an employee oran independent contractor,
codified by AB5, a worker ispresumed to be an employee
unless the hiring entity canprove three specific conditions
related to the worker's control,the nature of the work and the
(18:37):
worker's independent businessstatus.
But so here's the problem.
That happens, people are hiredas independent contractors and
paid a daily wage, but thenthey're required to be working
for 15 hours a day and if youcount the daily wage over a
period of a month, they'remaking well below the salary
(18:59):
requirements.
Yet they're not given lunches,they're not given breaks,
they're not given insurance.
That seems unfair for sure.
So I mean, I've seen it go bothways A lot of times.
Employers will not benefit, thecontractor will benefit.
If everything is proper as thelegislature intended it, it
should be a mutually beneficialrelationship, because the
(19:22):
employer gets a very specificservice and they don't have to
have this person on payroll.
Ilona (19:27):
What advice would you give to employees?
Mila (19:32):
I am a person of integrity .
I don't want to screw overcompanies.
I also don't want to screw overpeople Like I think everyone
should get what they're owed.
So here's the advice I wouldgive to all the employees is
that make documented complaints.
Whenever something bad happens,make a complaint, Because once
you make a complaint, theemployer has a duty to do
(19:56):
something about it to protectyou.
No matter how big or small itis, you should make a complaint
and make it in writing.
If people are experiencing ahostile work environment, it
should be documented and thenthe employer has a duty, what's
considered a hostile work?
environment.
Generally speaking, a place ofemployment doesn't have to be a
sorority.
Everyone doesn't have to besuper nice to each other.
(20:17):
But at the same time, ifthere's consistent hostile
reactions if a supervisor ishostile to employees they are
not properly managing them.
Ilona (20:27):
Would that be name calling?
Would that be?
Mila (20:29):
It can be name calling, it can be brushing them off, it
can be excluding them fromopportunities.
All of these things could behostile.
But here's the thing even ifit's something that's not
illegal, once you make acomplaint to HR, hr is going to
talk to the supervisor and justbe like hey, knock it off right,
like, and then you're protectedfrom retaliation.
Ilona (20:50):
So the employee needs to go to HR department and make a
written complaint.
Mila (20:54):
Yes, some companies are smaller, they don't have HR, but
you do have to make thecomplaint to someone who is in a
supervisory position.
Some of the most difficultcases to prove are pregnancy
discrimination cases because, asyou know, when a woman is
pregnant, a lot of times likeyou're more tired, you're a
little bit slower, you'recreating human life.
(21:14):
A lot of times, especially ifyou have morning sickness, you
can't really operate like youwould normally and the problem
is employers will write you upfor performance when you're
pregnant and the performanceissues may actually be related
to your pregnancy and theemployer isn't taking into
account.
Ilona (21:33):
Does it matter if you told the employer you were
pregnant versus you didn't?
Mila (21:37):
Yes, because if the employer has no knowledge you're
pregnant, you can't reallyprove that it's in
discrimination for yourpregnancy.
Ilona (21:43):
Yeah, that makes sense.
Mila (21:44):
But so I've had cases like that where you know employers
will write women up and thenwhen the I've had two cases like
this that when the woman tellsthe employer they're pregnant,
they start writing them up gaveme emails or correspondence
(22:14):
showing that, you know, prior tothe actual pregnancy they had
performance issues.
That weren't formallydocumented Maybe they weren't
written up, but there wereinternal emails showing that
this was an issue and those arevery hard to prove.
I actually had a case where awoman was five months pregnant
and she had a really high riskpregnancy.
So she didn't tell her employeruntil she was about five months
in.
And, um, she, immediately aftershe told them she was pregnant,
(22:40):
they started, uh, sending herwritten communication saying you
need to have your zoom cameraon during meetings.
Like this is against companypolicy.
You don't have your zoom cameraon during meetings.
Like this is against companypolicy.
You don't have your Zoom cameraon during meetings.
And she was like this has neverbeen an issue before.
But all of a sudden I'm gettingthese like documented write-ups
for not having my Zoom cameraon, like one time her camera
(23:02):
wasn't working and the chiefoperating officer would send her
these like very hostile textslike turn your Zoom camera on
all caps exclamation's like.
Well, what is happening?
Ilona (23:13):
so what happens if it was undocumented before the
pregnancy?
You said it's a difficult typeof lawsuit and gets documented
after.
To me it seems like once theemployer is unnoticed, then, and
if they have undocumentedbefore, well, they would still
be liable, but the would stillbe liable.
Mila (23:30):
but the problem is these cases just end up getting so
drawn out.
So for that particular case weended up filed in state court.
It was removed to the federalcourt because the employer was
in a different state and theemployee was remote and the
federal judge was just like nothaving it.
She was like, well, theemployer has communications
(23:51):
showing this was an issue before.
Just because they startedwriting her up formally after
she was pregnant doesn't meananything.
We ended up settling the case.
We spent a ton of time on itand even the judge was like
you're not going to be able toprove it.
Ilona (24:04):
I'm surprised that the pregnancy cases are more
complicated.
I thought they would be a loteasier.
Mila (24:10):
They're more complicated because it's such a fine line
between performance due topregnancy versus your
performance, like if you want toprove causation you have to
prove cause.
you have to prove that theadverse employment action or you
know whether it's a write up orcut hours or a termination is
(24:32):
because of your pregnancy.
Like the pregnancy, legally,the pregnancy has to be a
substantial motivating factor inthe employer's decision.
So if they had prior write-ups,prior things, even if it got
worse, you can't necessarilyprove that the pregnancy was a
substantial motivating factor.
Was it a factor?
(24:53):
Probably?
Ilona (24:53):
Wouldn't that apply to any disability, because
pregnancy is considered adisability.
Would that apply if someoneended up having some other
disability?
Or illness, and then they arenot performing their job.
Mila (25:06):
Yep and I see this a lot also performing their job.
Yep, and I see this a lot Also.
The other place I see thisoftentimes is mental health
disabilities such as anxiety,ptsd, even inability to sleep.
Insomnia could be a disabilityif your doctor qualifies as such
, if you have.
You know, a lot of veterans wesee coming back.
(25:26):
They're trying to reintegrateinto the workforce.
They have really bad PTSD.
They can't be around loudnoises.
Ilona (25:33):
But how does it work?
I know in another episode yousaid that as long as an employee
reports it, the employer has aduty to accommodate.
Yes, so let's say somebodyreported it and the employer
accommodated, but theirperformance is really terrible,
interferes with businessfunctions.
How does that work in terms ofa potential lawsuit when it ends
up in your hands?
It's hard.
Mila (25:51):
It's hard and you have to make the arguments on both sides
, and I do so.
That's the thing.
So the process has to go.
If a complaint is made that Ihave a disability or I'm unable
to perform my functions, youhave to provide from a physician
a note stating whataccommodations do you need
specifically?
And nowadays everyone wants tocome.
(26:12):
Every employer is trying to getemployees back into the office,
so they want to know from thephysician not just they have to
work from home, but like whataccommodations do they need at
home that I can provide here onsite?
And a lot of employers arefighting hard to force people
into office right now, like itis a thing.
(26:33):
So then they have to show thathere are the accommodations that
we can provide you so that youcan continue to effectively
perform the functions of yourjob with these accommodations.
Ilona (26:44):
So let's say, if someone cannot drive, an employer can
argue you can take an Uber,right?
Mila (26:48):
Well, if they pay for it if they, the employer is not
going to pay for an Uber if theycan't drive.
If they can't drive, if it's atemporary condition, maybe they
might be able to do remote for atemporary time, as long as
they're accommodating theconditions.
If their performance stilldoesn't meet up to the
expectations, they can thenterminate them.
(27:10):
As long as the employee can'targue I wasn't accommodated.
I'll say that, even when claimshappen, a lot of times
employers will keep making thesame mistakes again and again,
because every time there's aclaim, they quietly settle it
out before a lawsuit is filed.
Ilona (27:25):
I can see that applies to a lot of the sexual harassment
cases you handle.
Oh yeah, Especially when itinvolves attorneys and people
who are licensed or that havepublicity.
Mila (27:37):
Yeah, people with professional licenses don't want
, you know, public lawsuitsagainst them showing these
things.
So a lot of times employmentlawsuits will settle.
Ilona (27:46):
But then some people stupidly do it again and again.
They should learn from it, butthey don't.
Mila (27:51):
Yeah Well, California does have this fee shifting
provision.
That's in the law and itincentivizes employment
attorneys to take cases and itbasically says that if you're an
employee and you bring alawsuit, if you win on the
lawsuit, even if your verdict is$1, you can get all of your
attorney's fees and costs that'sunfair it is unfair.
(28:14):
It's a very unfair for theemployers.
But as a result, you know, youbring a claim and even it's a if
it's a very low value claim, anemployer has the incentive to
settle and pay a little bit of apremium like it's killing
california business I agree.
A lot of employers don't dobusiness in California because
of the cost of litigation.
Ilona (28:32):
I didn't even know that, but that sounds so ridiculous to
me.
Mila (28:35):
But so like you can bring, like I don't do this because I
have integrity, but sometimesplaintiff's attorneys will throw
everything at the wall andbring you know, maybe there's
one thing that was done wrongagainst this plaintiff, but they
will make a thousand claimslike harassment, discrimination,
retaliation, blah, blah, blahand make this huge lawsuit out
of it, even though there's onlyliability on maybe one claim.
(28:57):
But the employer, once theyhire an attorney, the attorney
is like okay, you only haveliability on one claim, but to
litigate this it's going to costus $200,000.
So even if your jury verdict atthe end of the day is $25 in
damages, you will owe thatattorney $200,000 in fees.
Ilona (29:16):
I think it's best to pay an attorney to defend than have
multiple lawsuits that are BS,because that just incentivizes
people to bring frivolous claims.
Mila (29:26):
But here's the problem Maybe you did screw up somewhere
.
Maybe there's like sometimesit's worth it to settle.
I see a lot of cases wherebecause there is vicarious
liability on an employer throughthe actions of a supervisor,
which means that if yoursupervisor screws up and does
something illegal, the employeris automatically liable for that
.
If the supervisor seessomething illegal happening and
(29:49):
fails to report it, the employeris automatically liable for
that.
So a lot of times you'll havesituations where, like, the
employer did nothing wrong, butthe supervisor either failed to
report or did something wrong,so the plaintiff will bring a
claim and it's worth payingrather than trying to F around
and find out Today's glam tip.
(30:14):
Know your worth and your rights.
Understanding your employmentstatus is crucial.
Ilona (30:20):
And remember, being informed is the first step to
empowerment, and the mostglamorous look you can have is
confidence and security.
Mila, thanks for talking aboutthis, and I think it's helpful
not just for employees, but alsofor business owners.
Mila (30:34):
And to our audience.
If this conversation openedyour eyes, share it.
Awareness is key.
Ilona (30:40):
Like your weekly dose of the glam, don't forget to
subscribe.
It's law, it's life, it's theGlamorous Grind.
Welcome to the Glamorous Grind where grit meets glamour
and the law is always in style.
Mila (00:04):
Today we're tackling a topic that affects many people
in the workforce themisclassification of employees
as independent contractors.
Ilona (00:14):
It's a practice that denies workers essential rights
and benefits, and, as businessowners, it is important to know
the difference.
Mila (00:21):
And as an employment attorney, this is something I
see unfortunately a lot.
Let's discuss how you canprotect yourself.
Ilona (00:38):
So, mila, before you joined our firm, you worked on
employment defense side for manyyears.
What sort of cases do you seethat are related to employee
status?
Mila (00:47):
Misclassification is very common, where people are
classified as independentcontractors as opposed to
employees, and the problem isthere's no black or white line
right.
Everything is arguable.
There are tests that courts useto determine if someone is
properly classified as anindependent contractor or if
they should be an employee.
(01:07):
A lot of times employers willmisclassify workers.
Sometimes this is accidental.
They don't know any better,especially when it's small
companies, they think they canhave independent contractors.
But other times employers dothis purposefully, honestly,
because it's a lot cheaper.
Why is it cheaper?
It's cheaper because they don'thave to give them insurance,
(01:29):
even though they're working fulltime.
It's cheaper because they don'thave to do payroll taxes.
They don't have to have them onthe payroll.
There are numerous benefitsthat employees get that
independent contractors don'tget.
Ilona (01:47):
Well, I take an issue with it being potentially
cheaper because some people whoare independent contractors they
may be independent contractorsbecause they have a lot of
skills in business and then theycharge more per hour to make up
for the benefits they have tobuy for themselves.
Mila (02:03):
So it's not necessarily cheaper, depending on what field
you're in.
Obviously right, it's reallydependent.
But there are certainsituations when people should be
classified as employees.
They act as employees becausethere are benefits that the law
instills in being an independentcontractor.
But sometimes employers don'tallow the employees to have
(02:24):
those benefits but they stillclassify them as contractors.
Here's the problem.
So when you're an employee of acompany, there are very
specific requirements to be asalaried employee where you
don't get breaks, you don't getlunches, you don't get paid
overtime, you get an hourlysalary.
So under California law thereare very specific requirements
(02:45):
you have to meet to be salaried.
That way the employee doesn'thave to give you lunches,
doesn't have to give you breaks,can work you 15 hours a day and
one of those requirements isyou got to be paid double the
minimum wage.
So if the minimum wage thatgoes up every year, right.
Ilona (03:00):
In California it does Every year.
They're like okay, here's theminimum annual salary, so as
long as you meet that, you'regood.
Mila (03:08):
Well, it's not just that, it also has to be.
There are very specific wageorders that provide which types
of employees can be salariedversus hourly.
So there are like executivepositions are people with very
specific licenses, likeattorneys, who can be salaried
as long as they meet the minimumwage requirement as well.
Ilona (03:30):
What are the juiciest cases you've handled on the
defense side?
Mila (03:34):
I can't say they get that juicy.
If I'm honest, I mean most ofthe time when I was on the
defense side and these casescame through my door I felt very
bad for the plaintiffs, becausethese plaintiffs worked like
crazy hours and they were paidwell under the annual salary
requirement and they wereworking crazy hours, not taking
(03:56):
lunches, working around theclock, and they barely made
enough to survive.
I mean, even with the minimumwage as high as it is in
California, with the cost ofliving so high, you need well
above double the minimum wage tolive comfortably.
And I'm not even talking aboutlive comfortably like you can
afford vacations, I'm talkingabout live comfortably like you
can afford food.
They were misclassified asindependent contractors, barely
(04:28):
paid the minimum thresholds oflike minimum wage if you count
the amount of hours they wereworking, not having any
insurance benefits, like theywould get sick and they can't go
to the doctor.
Ilona (04:35):
You know, the federal minimum wage, I think, is like
$7.
I don't know how people live onthat nowadays.
I mean it's impossible.
Mila (04:42):
Unfortunately, there are people who do work for that
amount because they have nochoice.
It's very sad because and again, I see it from both sides,
having come from the employmentdefense side and representing
employers, I saw employers doingeverything they could, trying
their best to pay theiremployees fairly, but the
(05:03):
minimum wage is so high and theystill have to make a profit.
Ilona (05:06):
Well, here's from an employer's perspective, and you
only learn when you know it'sbest to call an employment law
attorney.
Sometimes, when you want tohire people, they say, hey, can
I get paid as an independentcontractor?
And if you're not aware you canget sued.
That person may be trying toset you up, which happens
(05:27):
sometimes.
There are those people that arelike, oh yeah, I'll take a job,
and then they send you a letterthat's written by an attorney,
and so there are those that tryto set you up, and then there
are those who truly just feellike it's more convenient for
them to get paid as anindependent contractor.
What should employers know todo before agreeing to a request
(05:47):
by a potential employee to be anindependent contractor?
Mila (05:50):
I would recommend no matter how big or small you are
as an employer, you need toconsult with an attorney when
making hiring decisions.
Ilona (05:59):
What if they have an HR department?
Would they know?
Mila (06:02):
They might.
Sometimes the HR departmentshould consult with employment
attorneys.
Here's the problem.
Employment laws change everysingle year and it is impossible
to upkeep with it.
As an HR person Like you needan attorney involved to make
sure that even something assimple as your handbook is
(06:22):
compliant with all of theup-to-date laws.
So I always recommend this.
Employers need to haveattorneys involved.
I don't care if you have totake out a loan.
Consider it an investmentbecause the cost of litigation
in California is so high.
A nuisance value employmentcase in California could be
(06:43):
$50,000,.
Nuisance value that means ifyou get sued by an employee and
you get out of it paying 30grand after litigating the case
and paying your attorneys.
Like you've won.
Employers a lot of times doeverything they can, have the
best intentions and thingshappen and if you're not on top
(07:04):
of it, you will get sued.
That is just a fact.
Ilona (07:08):
Yeah, I mean, in America anybody can sue for anything.
Yeah, that's the reality.
That's why so many lawyers havepractices, good or not, it's
time to get gritty.
Audience Q&A.
Our listener asked thefollowing question hey, I've
been working full-time hours forthis company for over a year
and they tell me when to work,provide all the equipment I need
(07:32):
and I have to report to asupervisor, but I'm still
classified as an independentcontractor.
I receive no benefits.
They don't withhold taxes.
Is this legit?
What should I do?
Mila (07:43):
One of the requirements of being an independent contractor
in California is that theemployer, the company you're
contracting with, does notoversee your work.
You are independent, so you getto set your own hours.
You get to come and go as youplease, you get to make the
calls as to how your work isgoing to be handled and you're
(08:04):
paid on a contractual basis.
But sometimes the employer willbe like no, you have to be in
from eight to five every singleday.
You have to work on ourequipment.
You cannot work remotely andare very controlling over the
contractor's work.
That contractor should be anemployee at that point.
It shouldn't be a contractor.
I'm so excited I finally getthe glamorous flag.
Ilona (08:26):
And they match with your jacket, relatively speaking Okay
, so tell us if this is a redflag or a green flag.
You work for multiple clients,but the employer controls your
workflow.
Mila (08:41):
It depends.
So if you work for multipleclients through the employer,
through the company, and thecompany controls your workflow,
then that's absolutely a redflag because it sounds like the
company you should be anemployee, not an independent
contractor, mostly because theycontrol your workflow.
Now if you have multipleclients and those employers
(09:03):
control your workflow, then it'sa green flag because if you're
able to have multiple clients,even if they specifically
control kind of what you do inthe capacity of your contract
with them, that could be okay,so long as the other aspects are
made, because if you're workingmultiple clients, you probably
(09:23):
are not working full-time eightto five and you have flexibility
.
And then the other issue itwould depend on what industry
are you in versus what industryis the employer in.
Ilona (09:32):
Do you think it's helpful for people who work for
multiple clients to have anindependent contractor agreement
that's written and signed?
For example, they may beconsultant or just kind of go
with the flow and sign a W-9 andI'll pay you per hour.
Mila (09:52):
Oh, always have an agreement.
Always have an agreement.
Always have an attorney reviewthe agreement, Because the other
thing you have to look out forwhen you have multiple clients
when you're working in anindustry is they could have NDAs
.
If you've learned informationfrom one client that you could
potentially use in your workwith another client, you don't
ever want those allegationscoming at you if the two
(10:16):
companies are competing witheach other.
So it's extremely important tohave contracts in place.
Ilona (10:22):
Red flag or green flag, you're excluded from company
meetings and communications,despite doing similar work as
employees.
Mila (10:29):
I would say green flag.
I think it's okay if you'reexcluded from company meetings.
If you're not an employee ofthe company.
If you're an independentcontractor, even if you're doing
similar work, the employer orthe company has no obligation to
include you in company meetingsor internal company events.
Ilona (10:48):
Red flag or green flag.
You're an independentcontractor, but when you come to
the office to do a couple hoursof work, you're dressed in a
miniskirt and as if you're goingto a club showing all your
goodies.
Mila (11:04):
I think it depends.
In some places of employmentmaybe that is acceptable,
depending on the dress code ofthe company.
Ilona (11:14):
I guess I would say If it was in violation of the dress
code of the company?
Should you have an independentcontractor sign off on a dress
code policy for the company?
Mila (11:25):
You certainly don't have to, but the company could make
expectations to you clear ofwhat they expect you to dress
like, and if it's professionalattire, they absolutely have the
right to do that.
Ilona (11:39):
Red flag or green flag.
Have independent contractorsreview and sign off on their
acknowledgement of the employeehandbook that contains the terms
and standards that theemployees are bound by.
Mila (11:54):
I would say probably green flag, because the employer has
the duty to its employees toprotect the employees and a lot
of times those handbooks or alot of those policies will be
relating to harassment,discrimination, retaliation.
So employers could requiretheir independent contractors to
(12:16):
be bound by those policies.
However, there are policies inthose handbooks that contractors
are not going to be bound byMeal breaks, rest break,
requirements overtime.
So you know, if there arepolicies like that, it would be
red flag.
I would say if the employer istrying to get the contractor to
sign off on a handbook in itsentirety, it would probably be a
(12:38):
red flag.
They can't force them to bebound by all of their policies,
but if there are specificpolicies that the employer wants
the contractor to be bound bythat are general, I think that
would probably be okay.
Ilona (12:55):
Let's discuss this.
I know it's a gray area, butwhat if you are a personal
injury law firm with hundreds ofattorneys and they get to
choose whether they want to beindependent contractors or W-2
employees, and if they choose tobe independent contractors, you
still expect them to be at theoffice almost every day?
You give them your computer,all the software and they have
(13:16):
to be at the office X amount ofdays a week.
Would that be amisclassification?
Mila (13:23):
I would say probably.
I know that a lot of law firmsdo this, but technically, if you
are requiring your folks to bein office, if you are giving
them your equipment, they're notusing their own equipment.
If you are controlling the typeof work that they do, they
should be an employee and not acontractor.
Ilona (13:44):
With the rise of the gig economy, worker classification
has become a hot topic and nonefelt it hotter than Uber and
Lyft this year.
Mila (13:51):
Let's do an article breakdown.
Ilona (13:54):
I cannot imagine my life without DoorDash, without
Instacart, because I don't havetime to go and spend two, three
hours at Costco between driveand shopping, and I have to do
that once or twice a week.
And I'm so grateful that thesegig jobs exist because one I
don't have to go to.
(14:14):
These people make extra moneyand can support their families.
And it's just very convenient.
Mila (14:21):
So the issue was in about, I believe, 2019,.
85 came out that said that allthese Uber and Lyft drivers have
to be classified as employees,not independent contractors.
And Uber and Lyft fought thebill saying A our folks want to
be independent contractors, notemployees, because they like the
(14:42):
flexibility.
They don't want to be full-timeemployees or part-time
employees.
And B we don't have thecapacity to oversee these folks
as employees.
We don't have the capacity togive them health insurance, to
give them lunches and breaks anddo all of the administrative
work that goes into that Plusthat's going to increase the
cost for all users.
Oh, absolutely.
I mean and that was one oftheir arguments too the reason
(15:03):
why we can keep the cost down isbecause they're independent
contractors and we don't have topay for employing these folks.
So then they fought it and theybasically said we're going to
leave California and not dobusiness here if this continues.
So then Prop 22 was passed,said that they could be like
(15:24):
specifically for gig driverssuch as Uber, lyft, instacart.
They could be classified asindependent contractors even
though technically under the law, they should be an employee.
Ilona (15:36):
I think that's great.
It's a win for Californians.
One we get to have all thoseconvenient services.
Two for the citizens of ourstate to have that extra income,
especially for single parentsand those sharing custody.
Mila (15:52):
Yeah, no.
And the funny thing is Iremember being on the defense
side when all of that stuff washappening and I was like this
doesn't really benefit anyone.
It doesn't benefit workers.
If they can't have theflexibility A and B, then it's
going to be more expensive forthe consumer and they're going
to have to actually like applyfor work, as opposed to right
(16:12):
now they just sign up.
Ilona (16:14):
As long as they have good reviews on the app, they can
pretty much get the job and thestate can still control how much
taxes they collect because Uberand Lyft will issue 1089 to
those people, and the workerswho are independent contractors
may qualify for cheaper healthinsurance through Covered
California, which could costless sometimes than what their
(16:36):
premium would be through anemployer.
Mila (16:38):
And you know, like a lot of immigrants, they come to this
country.
They don't speak English.
What can they do?
I mean a lot of my uncles.
When we first came to thiscountry, most of them were taxi
drivers, but then, when Uber andLyft came out, they all went to
Uber and Lyft, even though theywere barely able to utilize
technology.
It just made a lot more senseto do Uber and Lyft than it was.
(16:59):
And I remember, even like withthe taxi drivers, it was so
inefficient because you have towait for a fare and they would
just sit around at these cafeslike waiting, whereas Uber and
lyft they set their ownschedules.
They turn on the app wheneverthey want to do work, they come
out to downtown and they, youknow, bid on the work and it
just makes sense for everyone.
Ilona (17:18):
I thought that the cabs will now be cheaper because uber
and lyft are a competition.
So recently when I traveled, Itook a cab from the airport last
.
To get to the airport from myhouse, I paid 60 bucks for using
Uber.
To get back using a taxi fromthe airport, I paid $160 plus.
(17:39):
Then tip on top of it and I waslike what?
I was surprised that it was waymore expensive.
I thought you know, they had tocompete and it would be about
the same, but it wasn't.
Mila (17:47):
I'm surprised taxis are still in business with Uber and
Lyft employees.
So yeah, I mean we'll see howit turns out.
But basically the lawsuit isthat the drivers who worked for
Uber and Lyft want back pay forthe time between AB5 went into
effect before Prop 22 was passed.
Ilona (18:05):
Let's decode the legal criteria that distinguish
employees from independentcontractors.
What's the ABC test and what'sAB5 got to do with it?
Mila (18:14):
The ABC test.
This is the primary test usedin California to determine if
their worker is an employee oran independent contractor,
codified by AB5, a worker ispresumed to be an employee
unless the hiring entity canprove three specific conditions
related to the worker's control,the nature of the work and the
(18:37):
worker's independent businessstatus.
But so here's the problem.
That happens, people are hiredas independent contractors and
paid a daily wage, but thenthey're required to be working
for 15 hours a day and if youcount the daily wage over a
period of a month, they'remaking well below the salary
(18:59):
requirements.
Yet they're not given lunches,they're not given breaks,
they're not given insurance.
That seems unfair for sure.
So I mean, I've seen it go bothways A lot of times.
Employers will not benefit, thecontractor will benefit.
If everything is proper as thelegislature intended it, it
should be a mutually beneficialrelationship, because the
(19:22):
employer gets a very specificservice and they don't have to
have this person on payroll.
Ilona (19:27):
What advice would you give to employees?
Mila (19:32):
I am a person of integrity .
I don't want to screw overcompanies.
I also don't want to screw overpeople Like I think everyone
should get what they're owed.
So here's the advice I wouldgive to all the employees is
that make documented complaints.
Whenever something bad happens,make a complaint, Because once
you make a complaint, theemployer has a duty to do
(19:56):
something about it to protectyou.
No matter how big or small itis, you should make a complaint
and make it in writing.
If people are experiencing ahostile work environment, it
should be documented and thenthe employer has a duty, what's
considered a hostile work?
environment.
Generally speaking, a place ofemployment doesn't have to be a
sorority.
Everyone doesn't have to besuper nice to each other.
(20:17):
But at the same time, ifthere's consistent hostile
reactions if a supervisor ishostile to employees they are
not properly managing them.
Ilona (20:27):
Would that be name calling?
Would that be?
Mila (20:29):
It can be name calling, it can be brushing them off, it
can be excluding them fromopportunities.
All of these things could behostile.
But here's the thing even ifit's something that's not
illegal, once you make acomplaint to HR, hr is going to
talk to the supervisor and justbe like hey, knock it off right,
like, and then you're protectedfrom retaliation.
Ilona (20:50):
So the employee needs to go to HR department and make a
written complaint.
Mila (20:54):
Yes, some companies are smaller, they don't have HR, but
you do have to make thecomplaint to someone who is in a
supervisory position.
Some of the most difficultcases to prove are pregnancy
discrimination cases because, asyou know, when a woman is
pregnant, a lot of times likeyou're more tired, you're a
little bit slower, you'recreating human life.
(21:14):
A lot of times, especially ifyou have morning sickness, you
can't really operate like youwould normally and the problem
is employers will write you upfor performance when you're
pregnant and the performanceissues may actually be related
to your pregnancy and theemployer isn't taking into
account.
Ilona (21:33):
Does it matter if you told the employer you were
pregnant versus you didn't?
Mila (21:37):
Yes, because if the employer has no knowledge you're
pregnant, you can't reallyprove that it's in
discrimination for yourpregnancy.
Ilona (21:43):
Yeah, that makes sense.
Mila (21:44):
But so I've had cases like that where you know employers
will write women up and thenwhen the I've had two cases like
this that when the woman tellsthe employer they're pregnant,
they start writing them up gaveme emails or correspondence
(22:14):
showing that, you know, prior tothe actual pregnancy they had
performance issues.
That weren't formallydocumented Maybe they weren't
written up, but there wereinternal emails showing that
this was an issue and those arevery hard to prove.
I actually had a case where awoman was five months pregnant
and she had a really high riskpregnancy.
So she didn't tell her employeruntil she was about five months
in.
And, um, she, immediately aftershe told them she was pregnant,
(22:40):
they started, uh, sending herwritten communication saying you
need to have your zoom cameraon during meetings.
Like this is against companypolicy.
You don't have your zoom cameraon during meetings.
Like this is against companypolicy.
You don't have your Zoom cameraon during meetings.
And she was like this has neverbeen an issue before.
But all of a sudden I'm gettingthese like documented write-ups
for not having my Zoom cameraon, like one time her camera
(23:02):
wasn't working and the chiefoperating officer would send her
these like very hostile textslike turn your Zoom camera on
all caps exclamation's like.
Well, what is happening?
Ilona (23:13):
so what happens if it was undocumented before the
pregnancy?
You said it's a difficult typeof lawsuit and gets documented
after.
To me it seems like once theemployer is unnoticed, then, and
if they have undocumentedbefore, well, they would still
be liable, but the would stillbe liable.
Mila (23:30):
but the problem is these cases just end up getting so
drawn out.
So for that particular case weended up filed in state court.
It was removed to the federalcourt because the employer was
in a different state and theemployee was remote and the
federal judge was just like nothaving it.
She was like, well, theemployer has communications
(23:51):
showing this was an issue before.
Just because they startedwriting her up formally after
she was pregnant doesn't meananything.
We ended up settling the case.
We spent a ton of time on itand even the judge was like
you're not going to be able toprove it.
Ilona (24:04):
I'm surprised that the pregnancy cases are more
complicated.
I thought they would be a loteasier.
Mila (24:10):
They're more complicated because it's such a fine line
between performance due topregnancy versus your
performance, like if you want toprove causation you have to
prove cause.
you have to prove that theadverse employment action or you
know whether it's a write up orcut hours or a termination is
(24:32):
because of your pregnancy.
Like the pregnancy, legally,the pregnancy has to be a
substantial motivating factor inthe employer's decision.
So if they had prior write-ups,prior things, even if it got
worse, you can't necessarilyprove that the pregnancy was a
substantial motivating factor.
Was it a factor?
(24:53):
Probably?
Ilona (24:53):
Wouldn't that apply to any disability, because
pregnancy is considered adisability.
Would that apply if someoneended up having some other
disability?
Or illness, and then they arenot performing their job.
Mila (25:06):
Yep and I see this a lot also performing their job.
Yep, and I see this a lot Also.
The other place I see thisoftentimes is mental health
disabilities such as anxiety,ptsd, even inability to sleep.
Insomnia could be a disabilityif your doctor qualifies as such
, if you have.
You know, a lot of veterans wesee coming back.
(25:26):
They're trying to reintegrateinto the workforce.
They have really bad PTSD.
They can't be around loudnoises.
Ilona (25:33):
But how does it work?
I know in another episode yousaid that as long as an employee
reports it, the employer has aduty to accommodate.
Yes, so let's say somebodyreported it and the employer
accommodated, but theirperformance is really terrible,
interferes with businessfunctions.
How does that work in terms ofa potential lawsuit when it ends
up in your hands?
It's hard.
Mila (25:51):
It's hard and you have to make the arguments on both sides
, and I do so.
That's the thing.
So the process has to go.
If a complaint is made that Ihave a disability or I'm unable
to perform my functions, youhave to provide from a physician
a note stating whataccommodations do you need
specifically?
And nowadays everyone wants tocome.
(26:12):
Every employer is trying to getemployees back into the office,
so they want to know from thephysician not just they have to
work from home, but like whataccommodations do they need at
home that I can provide here onsite?
And a lot of employers arefighting hard to force people
into office right now, like itis a thing.
(26:33):
So then they have to show thathere are the accommodations that
we can provide you so that youcan continue to effectively
perform the functions of yourjob with these accommodations.
Ilona (26:44):
So let's say, if someone cannot drive, an employer can
argue you can take an Uber,right?
Mila (26:48):
Well, if they pay for it if they, the employer is not
going to pay for an Uber if theycan't drive.
If they can't drive, if it's atemporary condition, maybe they
might be able to do remote for atemporary time, as long as
they're accommodating theconditions.
If their performance stilldoesn't meet up to the
expectations, they can thenterminate them.
(27:10):
As long as the employee can'targue I wasn't accommodated.
I'll say that, even when claimshappen, a lot of times
employers will keep making thesame mistakes again and again,
because every time there's aclaim, they quietly settle it
out before a lawsuit is filed.
Ilona (27:25):
I can see that applies to a lot of the sexual harassment
cases you handle.
Oh yeah, Especially when itinvolves attorneys and people
who are licensed or that havepublicity.
Mila (27:37):
Yeah, people with professional licenses don't want
, you know, public lawsuitsagainst them showing these
things.
So a lot of times employmentlawsuits will settle.
Ilona (27:46):
But then some people stupidly do it again and again.
They should learn from it, butthey don't.
Mila (27:51):
Yeah Well, California does have this fee shifting
provision.
That's in the law and itincentivizes employment
attorneys to take cases and itbasically says that if you're an
employee and you bring alawsuit, if you win on the
lawsuit, even if your verdict is$1, you can get all of your
attorney's fees and costs that'sunfair it is unfair.
(28:14):
It's a very unfair for theemployers.
But as a result, you know, youbring a claim and even it's a if
it's a very low value claim, anemployer has the incentive to
settle and pay a little bit of apremium like it's killing
california business I agree.
A lot of employers don't dobusiness in California because
of the cost of litigation.
Ilona (28:32):
I didn't even know that, but that sounds so ridiculous to
me.
Mila (28:35):
But so like you can bring, like I don't do this because I
have integrity, but sometimesplaintiff's attorneys will throw
everything at the wall andbring you know, maybe there's
one thing that was done wrongagainst this plaintiff, but they
will make a thousand claimslike harassment, discrimination,
retaliation, blah, blah, blahand make this huge lawsuit out
of it, even though there's onlyliability on maybe one claim.
(28:57):
But the employer, once theyhire an attorney, the attorney
is like okay, you only haveliability on one claim, but to
litigate this it's going to costus $200,000.
So even if your jury verdict atthe end of the day is $25 in
damages, you will owe thatattorney $200,000 in fees.
Ilona (29:16):
I think it's best to pay an attorney to defend than have
multiple lawsuits that are BS,because that just incentivizes
people to bring frivolous claims.
Mila (29:26):
But here's the problem Maybe you did screw up somewhere
.
Maybe there's like sometimesit's worth it to settle.
I see a lot of cases wherebecause there is vicarious
liability on an employer throughthe actions of a supervisor,
which means that if yoursupervisor screws up and does
something illegal, the employeris automatically liable for that
.
If the supervisor seessomething illegal happening and
(29:49):
fails to report it, the employeris automatically liable for
that.
So a lot of times you'll havesituations where, like, the
employer did nothing wrong, butthe supervisor either failed to
report or did something wrong,so the plaintiff will bring a
claim and it's worth payingrather than trying to F around
and find out Today's glam tip.
(30:14):
Know your worth and your rights.
Understanding your employmentstatus is crucial.
Ilona (30:20):
And remember, being informed is the first step to
empowerment, and the mostglamorous look you can have is
confidence and security.
Mila, thanks for talking aboutthis, and I think it's helpful
not just for employees, but alsofor business owners.
Mila (30:34):
And to our audience.
If this conversation openedyour eyes, share it.
Awareness is key.
Ilona (30:40):
Like your weekly dose of the glam, don't forget to
subscribe.
It's law, it's life, it's theGlamorous Grind.
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