Greg Wood Defeats Worker Misclassification Suit

The firm represents property owners and employers, which made the firm the best candidate to represent owners of apartment buildings in San Francisco and Marin who were sued by maintenance workers for wage and hour violations.  Plaintiff-maintenance workers claimed they were misclassified by the apartment building owners as independent contractors instead of employees, depriving them of pay for overtime, rest periods, and meal breaks.  One plaintiff also pursued on-the-job injury claims, alleging defendants should have maintained workers compensation insurance for them. Plaintiffs sought nearly a half million in damages.

The case was unique in that it involved the regular factors for determining whether a worker is an independent contractor versus an employee, as well as Labor Code § 2750.5, which establishes a rebuttable presumption affecting the burden of proof that a worker performing services for which a license is required is an employee, rather than an independent contractor.  Plaintiffs argued that they were performing the work of a general contractor when the leader of them only had a plumber’s license, entitling him to the presumption.

The case went to trial in San Francisco Superior Court.  After a 10-day bench trial, the Court ruled in our client’s favor.  The Court found that defendants sufficiently rebutted the Labor Code presumption and the weight of the evidence favored a finding that plaintiffs were independent contractors, barring plaintiffs from recovery for their claims.

The Court went one step further, though.  The firm filed a cross-complaint arguing that plaintiffs’ own admission of performing work which needed a general contractor’s license entitled the defendants, our clients, to reimbursement under Business and Professions Code § 7031(b). That Code section makes it possible for property owners to deny, even claw back, money paid to unlicensed contractors. The Court agreed, awarding our clients $250,000 in reimbursement damages, disproving the long-time notion that one cannot have their cake and eat it too.

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