California Supreme Court redefines ’employer’ — Business Management Daily: Free Reports on Human Resources, Employment Law, Office Management, Office Communication, Office Technology and Small Business Tax Business Management Daily

California Supreme Court redefines ’employer’

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The California Supreme Court has ruled that California law on who is or is not an employee goes beyond the definition contained in the federal Fair Labor Standards Act (FLSA) and includes a broader measure of who is an employer (see box below).

It said that someone who exercises control over wages, hours and working conditions can also be an employer. If a business knows that someone is working to the business’s benefit and fails to prevent that work, it may be liable for unpaid or underpaid wages.

Recent case: The case involved a strawberry grower, Isidro Munoz, who hired pickers to harvest the berries. Munoz had contracts with several other individuals to provide them with strawberries either for direct sale to consumers and supermarkets or to a plant that freezes and packages produce. Who got which berries on any given day depended on the ripeness of the crop, with riper fruit going to the freezer.

Because the price of berries plummeted during one year, Munoz was unable to pay his pickers on time. He eventually filed for bankruptcy and the workers remained unpaid.

They sued the individuals and businesses that bought the strawberries from Munoz, arguing that under California law, they were employers.

The court carefully reviewed the history of wage-and-hour law in California and found that state law went further than federal law. Under California law, it ruled, someone could be an employee of other entities that controlled the terms and conditions of work and benefited from the work—even though another individual or company was the official employer.

However, in this case, the court said Munoz alone was the employer because he controlled every aspect of the daily work of the pickers, including who was hired and fired, when they took breaks and which fields they picked on any particular day.

The buyers merely bought what the pickers picked, and did not have the right to say how the pickers should go about their work. (Martinez, et al., v. Combs, et al., No. S121552, Supreme Court of California, 2010)

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