We are seeing more and more class action lawsuits brought against employers for misclassification, so now is a great time to make sure your employees are classified correctly.

Many of you have received questions about classification and pushback from potential or current personnel. This is normal, and we understand! But while the application of AB5 is a relatively recent development, it is not optional, and there are some serious consequences that come with not paying your people in the correct way.

Employment law is complicated. Nothing better encapsulates this than the Borello test, a long series of questions that, depending on what business you’re in and assuming that you’re addressing a situation where the ABC test does not apply, determines whether a worker may be classified as an independent contractor.

Although it’s tempting to wish for a one-size-fits-all answer that magically determines whether a worker, or a group of workers, is classified as an employee or a contractor, it’s important to remember that all three parts of the ABC test must be considered when determining classification as each part must be satisfied to classify a worker as a contractor.