Taxi Service Didn’t Show Driver Was Independent Contractor

By Joanne Deschenaux, J.D. November 1, 2018
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​A California trial court should not have dismissed a driver's wage and hour claims against a taxi service, a California appellate court ruled. The company did not establish under the state's "ABC" test, which was adopted by the California Supreme Court in Dynamex Operations West Inc. v. Superior Court (4 Cal.5th 903, 2018), that the driver was an independent contractor rather than an employee. The case should go to trial to determine the driver's status under the ABC test, the court said.  

Under the three-part test adopted by the Dynamex court, a worker is presumed to be an employee unless the hiring company establishes each of the following:

  • The worker is free from the control and direction of the company in connection with the performance of the work.
  • The worker performs duties that are outside the usual course of the company's business.
  • The worker is customarily engaged in an independently established trade, occupation or business of the same nature as the work performed. 

The taxi company failed to establish the third part of the test, the appellate court found. It is not enough for the company to show that the worker was capable of engaging in an independent business. Courts will consider whether the worker "independently has made the decision to go into business for himself or herself," according to Dynamex. Evidence includes whether the worker has taken steps to promote his or her business through incorporation, licensure, advertisements or routine offerings to provide services to the public, the court said.

The taxi service presented no evidence that the driver provided services for other entities independently of the company. The company therefore did not establish that the driver was customarily engaged in an independently established trade, occupation or business.

Garcia v. Border Transportation Group, Calif. Ct. App., No. D072521 (Oct. 22, 2018).

Professional Pointer: The court did not rule that the driver was an employee, only that the company had not shown under the ABC test that he was an independent contractor. If the company can show that the driver was engaged in an independent business, it could still prevail on the wage and hour claims brought against it.

Joanne Deschenaux, J.D., is a freelance writer in Annapolis, Md.  

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