SRS Private Investigations

Many employers make the mistake of misclassifying employees as independent contractors, volunteers, trainees or interns. They do so for a variety of reasons. These are frequently related to the desire to avoid the many legal requirements applicable to employment relationships. What these employers fail to understand is that whenever work or any services are provided, the law imposes a legal presumption that the working relationship is one of employment. This is true regardles...s of how the parties characterized the relationship, or whether or not the nature of the parties’ understanding is in writing. For example, if a claim for overtime compensation, workers compensation benefits, unemployment benefits, workplace harassment or discrimination (to name just a few) is initiated, the business-entity defendant will attempt to defend the claim on the basis that the working relationship was not one of employment, but that the claimant was alternatively an independent contractor, volunteer, trainee or intern. Because of the legal presumption referenced above, the business will be assigned the burden of proof to establish that the relationship was not one of employment. This will require the employer to satisfy the detailed and demanding rules that apply, depending on the nature of the relationship asserted by the defendant. If the employer asserts that the working relationship is one of independent contractor, it will be required to prove the criteria applicable to that relationship. The same is true if the employer asserts the relationship was one of volunteer, trainee or intern. Different rules apply to each. As explained in this article, to be legally enforceable under California law, a trainee/internship relationship cannot provide any immediate benefit to the employing entity, or it will be deemed to be an employment relationship. This rule alone disqualifies the vast majority of claimed training/internship relationships, and subjects the employing entity to enormous legal exposure for unpaid wages, tax withholdings, unpaid rest and break periods and fringe benefits provided to similarly-situated workers who were paid as employees. To illustrate, in one famous case, Microsoft Corp. agreed to a settlement of $99 million after several workers alleged that they had been misclassified as independent contractors.

Many employers use "volunteers" without realizing that they are actually "employees" under California law. California law includes a legal presumption of employment whenever services are exchanged unless several rigid criteria are satisfied. Employers who misclassify workers as "volunteers," "interns" or "trainees," face potentially-enormous legal exposure in the event a worker's status is challenged. ... This ongoing seminar series is being conducted by veteran Petaluma labor & employment attorney, Jay Putnam. Putnam, has advised employers exclusively, in labor matters for over 36 years. He hopes to provide local business owners and managers with a solid, working understanding of California labor law, as a means of helping them avoid the often crippling cost and disruption caused by lawsuits resulting from a misunderstanding of applicable legal requirements. Feel free to contact us at 707-537-1091 for futher information.

I was provided this article for employers to help protect themselves from lawsuits. It is very insightful and I hope all of you are able to use it. Employee lawsuits against employers can cost millions.... Every employer should immediately implement a mandatory arbitration policy. Read on to understand why and how employers should institute this policy. For small business owners, the stakes are highest, because they are in effect unwittingly disarmed and deprived of the ability to defend themselves, even in those cases when they have done nothing wrong. Some employers have attempted to address this problem by purchasing employment practices liability insurance (EPLI). However, this is an imperfect solution, because insurance policies are prohibited by law from covering awards for punitive damages. Since punitive damages present greatest risk for employers in employment cases, the problem remains unaddressed. The good news is that the solution to this nightmare is already at hand, yet most small business employers don’t take advantage of it. In 1992, the U.S. Supreme Court authorized employers, for the first time, to implement mandatory arbitration policies in the workplace. Although arbitration has, predictably, met furious opposition ever since, it remains a powerful equalizing force for employers, but only if a policy is distributed in writing to employees in accordance with mandatory procedural safeguards. Employers with such policies in place before a dispute arises can demand that lawsuits be immediately diverted from the traditional civil litigation system (jury trial), to mandatory arbitration. While employers still have to prove their defense to the satisfaction of an arbitrator, this solves problems related to anti-employer jury bias summarized above. Most importantly, the arbitration process usually resolves disputes much quicker than jury trials, because it provides for abbreviated pre-trial motion and discovery procedures, and arbitration can reduce the employer’s defense costs by as much as 90 (ninety!) percent. For this reason alone, the question of why every employer in California is not protected by such a policy presents an enduring mystery. ________________________ Jay G. Putnam is a Petaluma labor lawyer representing California employers for more than three decades. www.jaygputnam.com/blog/.

This company did an excellent job performing background checks for our business. They were prompt and professional. They found out some interesting facts about one of our applicants and we were grateful since we could have made a bad hire. Thank guys!!

We will begin offering free advice and educational material around pre-employment backgrounds and screening. Keep watching!

From workers compensation investigations to surveillance, SRS Private Investigations does it all. Learn more about our services and how we can help you at http://www.srspi.com/.

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Before you sign a contract of offer someone employment with your company, ensure they are the right fit with background checks and more from SRS Private Investigations. We help you identify potential threats so you can make an informed decision. Learn more at http://www.srspi.com/index.php.