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Supreme Court rules in favor of carriers

Decision buttresses U-T carriers' claims in case finalized in January

The California Supreme Court ruled today (June 30) that a worker is an employee if the employer has the right to control the worker's behavior. The matter at hand was whether carriers for Antelope Valley Newspapers could be granted class-action status in a case similar to one in which carriers won a $10 million judgment against the Union-Tribune in January.

The highest court upheld the appellate court's decision granting class status to the Antelope carriers, who were arguing that they were not independent contractors but were actually employees because the company controlled their conduct. That was the major issue in the U-T case. The Orange County law firm of Callahan & Blaine won such cases against the Orange County Register and the U-T, and has similar cases against the Sacramento Bee and Fresno Bee.

Said the Supreme Court, "Whether a common law employer-employee relationship exists turns foremost on the degree of a hirer's right to control how the end result is achieved."

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The California Supreme Court ruled today (June 30) that a worker is an employee if the employer has the right to control the worker's behavior. The matter at hand was whether carriers for Antelope Valley Newspapers could be granted class-action status in a case similar to one in which carriers won a $10 million judgment against the Union-Tribune in January.

The highest court upheld the appellate court's decision granting class status to the Antelope carriers, who were arguing that they were not independent contractors but were actually employees because the company controlled their conduct. That was the major issue in the U-T case. The Orange County law firm of Callahan & Blaine won such cases against the Orange County Register and the U-T, and has similar cases against the Sacramento Bee and Fresno Bee.

Said the Supreme Court, "Whether a common law employer-employee relationship exists turns foremost on the degree of a hirer's right to control how the end result is achieved."

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Comments
12

It appears that U-T San Diego has little chance of overturning the January decision in the Appellate Court after the Supreme Court ruling. Papa Doug is going to have to raise $10 million to pay off the carriers. Papa Doug is proof that the best way to make a small fortune in the newspaper business is to invest a large fortune in the newspaper business.

June 30, 2014

Burwell: Yes, I think it will be difficult for the U-T to overturn that January decision. It appears Papa Doug will be shelling out $10 million. Best, Don Bauder

July 1, 2014

A case like this one should have never needed to go to the state supreme court for resolution. Even the poorest excuse of an HR director could have quickly determined that those folks were employees and entitled to pay and employment taxes being paid on their behalf. For the past few decades, employers have been attempting to play the independent contractor game, and many have managed to get away with it for long periods of time. The usual result when it is challenged is that the courts rule that the employees are, in fact, employees.

The smartest thing the two McClatchy "Bee" papers could do now is settle for the best terms they can get. Further litigation will cost them big bucks that they pound down the rat hole of attorney fees. They will not prevail.

July 1, 2014

Visduh: The Sacramento Bee case was hinging on this decision. I would guess McClatchy will settle both the Sacramento and Fresno cases. Best, Don Bauder

July 1, 2014

Has the IRS run an "SS*" investigation? Seems like the easy way to do it.

July 2, 2014

CaptainObvious: An SS* investigation? Please explain. Best, Don Bauder

July 2, 2014

Sorry, typo. "SS-8" investigation. I had one done when an employer, after inducing me to move 300 miles (spending all my funds), told me on day one that I was now an "independent contractor", rather than an employeee. This allowed him to skate on fees and taxes, and trapped me into a job for which I would have asked for 1/3 more money, had I known in advance, since my tax payments were now to be much more, with no unemployement or disability coverage.. I demanded more pay and was laughed at. The IRS determined that I, along with 8 other workers, and every other employee for the last 15 years was an employee, and not an independent contractor. The employer was not pleased. I then showed the EPA and Water agency where the toxins were dumped. He should have played fair.

July 3, 2014

CaptainObvious: OK. I understand. Congrats for sticking to your guns. Best, Don Bauder

July 3, 2014

Congress changed the law to make it virtually risk free for employers to improperly convert employees to independent contractors. If the employer issued 1099s to the improperly converted employees and the employer is later busted by the Revenuers, the employer owes no interest or penalties on the unpaid employment taxes and withholding so as long as the employer pays the tax within ten days after receiving the bill. The employer doesn't have to pay the withholding if he/she shows the employees paid the withholding.

July 3, 2014

Burwell: That may be true, but the newspapers have gotten knocked down by California courts. Best, Don Bauder

July 3, 2014

Don, I wish this court ruling had been made under the Copley regime. Helen and David would have been livid. Gekko

July 4, 2014

gekko: The practice of hiring newspaper carriers and calling them independent contractors -- the heart of these cases -- began under Copley management. The cases took a long time winding their way through the courts. Best, Don Bauder

July 4, 2014

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