Michael Kun, a Member of the Firm in the Labor and Employment practice in the Los Angeles office, was interviewed for an article about a recent Supreme Court ruling in California expanding the definition of “employer” for purposes of wage-hour claims.
The article discussed a May 20, 2010 California Supreme Court ruling in a class action brought by seasonal agricultural workers. According to the article, what was interesting about this ruling is that the court adopted the Industrial Welfare Commission’s definition of “employer,” which states that an employer is one who exercises control over the wages, hours or working conditions of the employee; suffers or permits the employee to work; or engages the employee, thereby creating a common law employment relationship. With this new definition, the article mentioned that companies need to be more careful about their dealings with vendors and contractors, including temporary agencies.
“The ruling is likely to give plaintiffs attorneys the means to cast a wider net when bringing cases over unpaid wages, with multiple defendants likely to be part of their new strategy to increase the value of potential settlements,” said Kun.
“If this is not on the radar of companies doing business in California, it needs to be,” Kun continued. “The message that I take from this is that these companies need to explore their relationships, both contractually and practically, with every entity that provides services for them.”
“Companies will also likely want to fine-tune the wage payment requirements and indemnification provisions in their agreements with service providers to make sure they are protected in the event that someone they are contracting with is found to have violated wage-and-hour laws,” Kun added.