• LinkedIn
  • YouTube
  • Twitter
  • Facebook
  • Google+

You may not get your choice of law

by on
in Employment Law,Human Resources

If you engage independent contractors, you may include a “choice of law” clause in your contracts, designating which state’s laws will apply should a dispute arise. But that doesn’t mean courts will always agree to the jurisdiction you prefer.

Affinity Logistics, a California trucking firm incorporated in Georgia, selected Georgia law to resolve disputes. Truck drivers from Cali­­for­­nia filed a class-action suit against the firm, claiming that they were actually employees and therefore entitled to overtime and benefits.

The firm sought to move the case to Georgia courts based on the contract language. The drivers moved to have the case decided under Cali­­for­nia law. Ultimately, the 9th Cir­­cuit Court of Appeals sided with the drivers.

The court found that California’s employee protections created a strong public-policy argument for deciding the case under California law.

It also found that the drivers entered into the agreement in Cali­­for­­nia and worked in Cali­­fornia. The only connection to Georgia was Affinity’s decision to incorporate there.

The court did not decide whether the drivers were employees or independent contractors. Instead, it re­­manded the case to a lower court to decide the issue under California law. California law generally presumes a worker to be an employee unless the employer has strong evidence to prove the worker’s independent status.

This case shows that employers may not simply shop for a state with sympathetic laws for work largely performed in California. Always consult your attorney before designating a worker as an independent contractor.

Like what you've read? ...Republish it and share great business tips!

Attention: Readers, Publishers, Editors, Bloggers, Media, Webmasters and more...

We believe great content should be read and passed around. After all, knowledge IS power. And good business can become great with the right information at their fingertips. If you'd like to share any of the insightful articles on BusinessManagementDaily.com, you may republish or syndicate it without charge.

The only thing we ask is that you keep the article exactly as it was written and formatted. You also need to include an attribution statement and link to the article.

" This information is proudly provided by Business Management Daily.com: http://www.businessmanagementdaily.com/30664/you-may-not-get-your-choice-of-law "

Leave a Comment