Supreme Court holds that Dynamex test to determine independent contractor status applies to conduct occurring prior to Dynamex decision

2021 case review: Vasquez v. Jan-Pro Franchising International, Inc.

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In 2018, in Dynamex Operations West, Inc. v. Superior Court, 4 Cal.5th 903 (2018),the Supreme Court held that in determining whether a worker is an employee or an independent contractor for purposes of California’s wage laws, the “ABC test” applies. The ABC test holds that a worker is an independent contractor only if the hirer can establish “…A) that the worker is free from the control and direction of the hirer in connection with the performance of the work, both under the contract for the performance of such 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 for the hiring entity.”

In this case, the Ninth Circuit had asked whether the Supreme Court’s finding in Dynamex was retroactive, that is, does the test apply to litigation that resulted from practices that had occurred prior to the Dynamex decision.

The Supreme Court held that it did apply to cases retroactively. The Court noted that it the decision had not changed a settled rule, so that applying it to the current case was not unfair.