Tuesday, October 23, 2018
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Driver Who Leased Vehicle Was an Employee Of Taxi Company—Court of Appeal
By a MetNews Staff Writer
A taxicab driver who leased a vehicle and operated according to his own schedule and in his chosen geographic region was nevertheless an employee of the company that owned the taxi, the Fourth District Court of Appeal said yesterday.
The opinion by Justice William Dato of Div. One was certified for partial publication.
Imperial Superior Court Judge Diane B. Altamirano granted summary judgment to the defendant, Border Transportation Group, LLC, which owns taxicabs and permits in Calexico. She applied the factors set forth for determining whether someone is an employee or an independent contractor by the state Supreme Court in the 1989 case of S.G. Borello & Sons v. Department of Industrial Relations.
Altamirano relied on the lack of control exerted over the plaintiff, Jesus C. Garcia, by Border Transportation. The driver leased the vehicle and was not paid any wages, nor was he bound to follow any dispatch instructions given over the optional dispatch service provided by the company.
Garcia, appealed the denial of his wage and hour claims. After the appeal was briefed, the Supreme Court issued its opinion in Dynamex Operations West, Inc. v. Superior Court, in April of this year, which led Div. One to reverse Altamirano’s judgment on several of the claims.
Dynamex’s Holding
In Dynamex, the high court held, in a unanimous opinion authored by Chief Justice Tani Cantil-Sakauye, that in cases based on wage orders by the Industrial Welfare Commission, the wage orders’ definition of “employ” applies, rather than the Borello multi-factor employee/independent contractor test.
Borello had arisen in a workers’ compensation case, not a wage-and-hour context.
The wage order in Dynamex—Wage Order No. 9, which governs transportation drivers and is also applicable to Garcia’s claims—says:
“ ‘Employ’ means to engage, suffer, or permit to work.”
The Supreme Court adopted a test for understanding this definition, which had already been adopted by several other jurisdictions.
‘ABC’ Test
The three-part test adopted by the Dynamex court, called the “ABC” test, presumes that a worker is an employee. The presumptive employer can rebut the presumption if it proves:
“(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; and (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.”
A failure to prove any one of these three elements means the worker is an employee for the purpose of wage order claims.
Part C Dispositive
In determining Garcia’s status, Dato addressed only part C of the ABC test. He wrote:
“Key for our purposes, Dynamex makes clear that the question in part C is not whether BTG prohibited or prevented Garcia from engaging in an independently established business….Instead, the inquiry is whether Garcia fits the common conception of an independent contractor—‘an individual who independently has made the decision to go into business for himself or herself’ and ‘generally takes the usual steps to establish and promote his or her independent business—for example, through incorporation, licensure, advertisements, routine offerings to provide services of the independent business to the public or to a number of potential customers, and the like.’ ”
Garcia, he noted, did not work with any other cab company. Nor could he have done so easily, he said; Calexico’s licensure scheme requires drivers to have a different permit for each company with which they work, and only issues 45 licenses to taxi companies, 30 of which are owned by Border Transportation.
Dato pointed out that Dynamex’s ABC test only applies in wage order cases; in other contexts, including wage and hour claims predicated on the Labor Code itself rather than a wage order, the Borello factor test still controls.
He wrote:
“It is logical to apply the ‘suffer or permit to work’ standard (and the ABC test that explicates it) to wage order claims. First, the wage order explicitly defines ‘employ’ in this language, and the case law emphasizes ‘the primacy of statutory purpose in resolving the employee or independent contractor question.’…Second, wage orders regulate very basic working conditions for covered California employees, thus warranting ‘the broadest definition’ of employment to extend protections to ‘the widest class of workers.’ ”
In an unpublished portion of the opinion, Dato said that summary adjudication was proper for those of Garcia’s claims not predicated on Wage Order No. 9, such as unpaid overtime and wrongful termination, because the driver forfeited any appellate review of them by failing to cite any admissible evidence creating a triable issue of fact.
The case is Garcia v. Border Transportation Group, LLC, D072521.
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