Understanding Worker Misclassification in California: What Every Worker Needs to Know
- Haulk & Herrera LLP
- Jul 21
- 3 min read
In today's fast-paced job market, many California workers are being wrongly labeled—costing them critical rights and protections. Whether you’re classified as an independent contractor or paid in cash under the table, misclassification can rob you of important benefits like overtime pay, unemployment insurance, and workplace protections.
This blog breaks down what worker misclassification is, how to recognize it, and what you can do to protect yourself under California labor law.
What is Worker Misclassification?
Worker misclassification occurs when an employer wrongly classifies a worker as an independent contractor rather than an employee. This is especially relevant in California, where strict employment classification laws apply under AB 5 (Assembly Bill 5) and the California Labor Code.
Employers often misclassify workers to avoid paying payroll taxes, benefits, and workers' compensation. But the cost of misclassification falls squarely on the workers—who are stripped of legal protections they are entitled to as employees.
Example: If you receive a 1099 form instead of a W-2, you may be wrongly classified. A 2020 report from the Economic Policy Institute estimated that nearly 10 million U.S. workers are misclassified, leading to lost wages and benefits.
Key Legal Protections You May Be Missing
If you're misclassified in California, you could be losing out on:
Overtime Pay: California law requires employers to pay time-and-a-half for hours worked over 8 in a day or 40 in a week. Independent contractors are not eligible for overtime.
Unemployment Benefits: Employees are eligible for unemployment insurance through the California Employment Development Department (EDD), but independent contractors typically are not.
Paid Sick Leave and Family Leave: California employees are entitled to paid sick leave and protected time off under CFRA and FMLA—benefits that misclassified workers often miss.
Health Insurance and Retirement Plans: Most full-time employees receive benefits like health insurance or 401(k) plans—benefits not provided to independent contractors.
Anti-Discrimination Protections: California employees are protected by laws like the Fair Employment and Housing Act (FEHA), but misclassified workers may not have access to these protections.
Red Flags That You May Be Misclassified
If any of the following apply to your job, you may be an employee—not a contractor:
Your employer sets your work hours or directs how tasks are done.
You're given tools, uniforms, or equipment needed for the job.
You work regularly or full-time for the same employer.
Your work is central to the business (e.g., delivery drivers, warehouse workers, or restaurant staff).
You’re not running an independent business with multiple clients.
In California, the ABC Test is used to determine proper classification. Under this legal test, most workers are presumed to be employees unless the employer can prove otherwise.
Steps to Take if You’re Misclassified
If you think you've been misclassified in California, take action:
Document Everything: Track your hours, pay, tasks, and any communications with your employer.
Know Your Rights: Visit the California Department of Industrial Relations (DIR) for information on classification and wage claims.
Consult an Employment Attorney: Legal professionals can help assess your classification and advise next steps.
File a Complaint: You can file a wage claim or misclassification report with the California Labor Commissioner’s Office.
Seek Legal Remedies: Many workers are entitled to back pay, penalties, and attorney’s fees if misclassification is proven.
Immigration Status Does Not Limit Your Rights
California labor laws protect all workers, regardless of immigration status. You do not need to be a U.S. citizen or have legal documentation to file a wage claim or seek legal remedies for misclassification. Don’t let fear prevent you from asserting your rights.
Worker Solidarity & Legal Action Matter
Misclassification often thrives in industries like construction, hospitality, transportation, and gig work. It takes courage—and often legal support—to confront these violations. By speaking up, workers can challenge unfair labor practices and create safer, more just workplaces.
Get Legal Support from California Employment Attorneys
If you believe you’ve been misclassified or denied your rights as a worker in California, don’t wait.
Haulk & Herrera LLP is a trusted employment law firm with offices in San Francisco and Los Angeles, representing workers across California who have been misclassified, underpaid, or wrongfully terminated. Our legal team has extensive experience handling:
Independent contractor misclassification claims
Wage and hour violations
Discrimination and retaliation cases
Unpaid overtime and benefits disputes
We’re committed to protecting workers’ rights—regardless of immigration status—and securing the compensation and justice you deserve.
Contact Haulk & Herrera LLP Today
If you’ve been misclassified or need legal advice about your employment rights in California, reach out to Haulk & Herrera LLP for a confidential consultation.
415-745-3219
Offices in San Francisco and Los Angeles
You have rights. We’re here to help you fight for them.
