California Governor Signs S.B. 459, Dramatically Increasing Penalties for Misclassifying Employees as Independent Contractors

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As was anticipated, California Governor Edmund G. (“Jerry”) Brown announced on October 9 that he signed Senate Bill 459. That legislation imposes dramatic penalties on employers found to have engaged in “willful misclassification” of workers as independent contractors, as well as on non-lawyer advisors who knowingly counsel to engage in such reclassification. For a detailed explanation of this important new law, a discussion of its probable impact, and some suggestions on coping with it, see our Alert dated September 28, 2011, which can be found here. S.B. 459 has been chaptered by California’s Secretary of State as Chapter 706, Statutes of 2011. It will appear as Sections 226.8 and 2753 of the California Labor Code.

Summarizing S.B. 459 briefly, the new law...

Please see full alert below for more information.

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