This document summarizes California contractor law and the Dynamex decision. It discusses how 20% of the U.S. workforce are contractors and the difference between employees and contractors. It then explains the ABC test created by the Dynamex decision, which established a stricter test to determine whether a worker is an employee or independent contractor. The document discusses some practical implications of the decision and tips for complying with the new law. It concludes by providing the author's contact information for any questions.

1. C A L I F O R N I A
C O N T R A C T O R
L A W
B R A D E N D R A K E L A W

2. HI, I'M BRADEN
Lawyer
Tax consultant/preparer
WeWorker
Runner
Enneagram 7
ENTJ

3. A C C O R D I N G T O T H E
I N T E R N E T
of the U.S. work force are contract workers
20%

4. Employees - person
employed for wages or
salary, especially at a non
executive level. Typically,
receives W-2.
Contractors - persons,
businesses, or corporations
that provide goods or
services to another entity
under terms specified in a
contract.
80% 20%

5. DYNAMEX V. SUPERIOR COURT
8 0 P A G E S O F F U N
OLD LAW VERSUS NEW LAW

6. T H E O L D L A W

7. Under the new law, this is
getting more complicated.

8. DYNAMEX V. SUPERIOR COURT
A) The worker must be "free from the control and direction of the
hirer;
B) The worker must "perform work that is outside the course of
the hiring entity's business"; and
C) The worker must "customarily be engaged in an
independently established trade, occupation, or business of
the same nature as the work performed for the hiring entity.

9. THE PRACTICAL EFFECT
Dynamex dealt specifically with wage orders. It has not spread to
all areas of contract law.
We really have no idea what's going to happen, but let's make
some educated guesses and plan accordingly.

10. PART C
Key Takeaway: "Established Business"
Look for: EIN, equipment, social media, business bank account,
presence, other marketing, local business license, website,
business entity.

11. PART B
Does frequency matter?
"If a bakery hires cake decorators to work on a regular basis,
then those cake decorators are likely working within the bakery's
'usual business operation,' and thus would be employee."

12. PART B
The court also provides an example of an art instructor hired to
teach at a museum "on a regular and continuous basis."

13. PART B
What is the worker is working on a regular, continuous basis?
- May be time to reclassify; or
- Assess your risk

14. "Dynamex Employee"
Some Tips:
- Make sure the worker uses their own equipment
- Ensure that the contractor has taken steps to form their own
business
- Put an arbitration clause in your contractor agreement
- Know the wage order and stay in compliance

15. Employee, Employee
Time to reclassify

16. S T A Y I N T O U C H
C A T C H M E O N T H E G R A M :
C R E A T I V E P R E N E U R C O N S U L T I N G

17. F R E E B I E S & E V E N T S
D I Y T A X P A R T I E S
T A X F R E E B I E S
L E G A L F R E E B I E S
S M A L L B U S I N E S S S T A R T U P G U I D E
D I G I A L N O M A D T A X G U I D E

18. Q U E S T I O N S
B R A D E N D R A K E L A W . C O M
C R E A T I V E P R E N E U R C O N S U L T I N G . C O M