Duffey v. Tender Heart Home Care Agency ( 2019 )

Filed 1/11/19
CERTIFIED FOR PUBLICATION
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
FIRST APPELLATE DISTRICT
DIVISION FIVE
NICHELLE DUFFEY,
Plaintiff and Appellant,
A152535
v.
TENDER HEART HOME CARE (Contra Costa County
AGENCY, LLC, Super. Ct. No. MSC15-02271)
Defendant and Respondent.
Plaintiff Nichelle Duffey (Plaintiff) sued defendant Tender Heart Home Care
Agency, LLC (Tender Heart) for, among other claims, failure to pay overtime wages
under the Domestic Worker Bill of Rights (Labor Code, §§ 1450 et seq.; DWBR),1 which
requires that domestic work employees receive overtime wages for all hours worked
more than nine hours per day or 45 hours per week. The trial court granted Tender
Heart’s motion for summary adjudication on the DWBR cause of action, finding the
undisputed facts demonstrated Plaintiff was an independent contractor rather than an
employee of Tender Heart for purposes of the DWBR. We first conclude the trial court
erred in exclusively applying the so-called “common law” test set forth in S. G. Borello
& Sons, Inc. v. Department of Industrial Relations (1989) 48 Cal. 3d 341 (Borello), to
determine the issue. We next conclude that, under the appropriate tests, there is a dispute
of fact as to whether Plaintiff was Tender Heart’s employee. Accordingly, we reverse
and remand.
1
All undesignated section references are to the Labor Code.
1
FACTUAL BACKGROUND
In 2011, Plaintiff signed a form contract with Tender Heart titled “Professional
Caregiver Agreement” (the Caregiver Contract). The Caregiver Contract states that
Tender Heart “is a caregiver placement agency whose business is to obtain contracts for
caregivers in dwellings and to refer by subcontract such contracts to professional
independent caregivers.” The Caregiver Contract further states Plaintiff is “an
independent contractor” and “an independent domestic worker, who is in the business of
providing care giving services in dwellings and hereby solicits such contract for services
from [Tender Heart].” Tender Heart also enters into contracts with clients.2 Its standard
client contract (the Client Contract) provides that Tender Heart “is engaged in the
business of qualifying, screening and referring caregivers,” and “is dedicated to matching
the right caregivers to each client’s needs.”
Judy Horvath, Tender Heart’s managing member, testified in her deposition that
when contracting with a new client, Tender Heart “ascertain[s] the needs of the client, the
brief medical history, so we know what’s going on with this particular person that we’re
caring for, and what they would like the caregiver to do; what their needs are. . . . [W]e
have to ascertain the need before we can relay those to our caregivers.” The standard
services provided by Tender Heart caregivers, as set forth in both the Caregiver Contract
and the Client Contract, are “companionship and conversation; attendant care; respite
care; personal care, grooming and hygiene; medication reminders; light housekeeping;
bathing assistance; meal planning and preparation; grocery shopping and errands;
transportation; escort to breakfast, lunch or dinner; answer telephone and door; help sort
mail; oversee home deliveries; attend social or religious activities.” (Capitalization and
formatting altered.)
Both the Caregiver Contract and the Client Contract attach rate sheets setting forth
standard hourly rates for shifts of different lengths. The client rate sheet states its rates
2
We use the term “client” to refer both to the person in need of caregiving services and
the person responsible for paying Tender Heart (sometimes, but not always, the same
person).
2
include both “caregiver and agency fees,” and the standard hourly rates charged to clients
are higher than the standard hourly pay rates for caregivers. Caregivers submit
timesheets signed by the client to Tender Heart; Tender Heart then bills the client and
pays caregivers from the money received from the client, keeping the difference as its
fee. Horvath testified the Client Contract rate sheet was a starting point but the ultimate
rate charged to a given client could vary. Plaintiff testified in her deposition that when
Tender Heart told her about a caregiving opportunity, “I would get an e-mail and there
would be a rate that I would be getting paid for that job. They [the rates] would vary,
depending on the needs of the client.” The parties dispute whether caregivers could
negotiate their pay rates directly with clients; we discuss this evidence in more detail
below (post, part II.C.1).3
It is undisputed that Tender Heart caregivers are free to reject any caregiving
opportunity offered by Tender Heart, and Plaintiff did reject offers from time to time.
Caregivers are also free to contract with other agencies for domestic work, and Plaintiff
did so during her time working for Tender Heart. Tender Heart did not provide Plaintiff
or other caregivers with training, tools, or supplies, and did not direct or supervise the
caregiver’s provision of services.
The Caregiver Contract provides: “The relationship between a CAREGIVER and
client may only be terminated by either of those parties and not by [Tender Heart].
However, [Tender Heart] may decline to make additional referrals to a particular
CAREGIVER . . . .” The Caregiver Contract, by its terms, remains in effect until notice
of termination by either party or a caregiver’s “material breach” including “[d]ischarge
. . . by client for just cause,” or “[a]t the direction of the client” where the caregiver
3
The Caregiver Contract also provides caregivers may elect to seek “permanent
placement,” paying Tender Heart a fee of “20% of the fees earned by CAREGIVER
during the first month of placement.” The Client Contract similarly includes terms for
caregiver permanent placement, whereby Tender Heart arranges interviews between the
client and prospective caregivers for a one-time flat fee. There is no evidence that
Plaintiff sought or received permanent placement from Tender Heart.
3
“failed to appear to perform services as scheduled.” Plaintiff provided Tender Heart with
notice of termination in or around March 2015.
When Plaintiff signed the Caregiver Contract in 2011, caregivers were (as they
still are) excluded from the overtime provisions of the applicable Industrial Welfare
Commission (IWC) wage order. (See IWC Order No. 15-2001 Regulating Wages,
Hours, and Working Conditions in the Household Occupations (Wage Order 15),
codified at Cal. Code Regs., tit. 8, § 11150, subds. 1(B), 2(J), 3(C) [excluding from its
overtime provision “any person employed by a private householder or by any third party
employer recognized in the health care industry to work in a private household, to
supervise, feed, or dress a child or person who by reason of advanced age, physical
disability, or mental deficiency needs supervision”].) Effective January 1, 2014, the
Legislature enacted the DWBR, which provides that certain workers, including
caregivers, “shall not be employed more than nine hours in any workday or more than 45
hours in any workweek unless the employee receives one and one-half times the
employee’s regular rate of pay for all hours worked over nine hours in any workday and
for all hours worked more than 45 hours in the workweek.” (§ 1454.) After the
enactment of the DWBR, Tender Heart did not pay Plaintiff overtime wages.
PROCEDURAL BACKGROUND
In December 2015, Plaintiff filed a complaint against Tender Heart. The operative
first amended complaint alleged Tender Heart failed to pay overtime wages in violation
of the DWBR, as well as several additional claims. Tender Heart moved for summary
adjudication of the DWBR claim and some of Plaintiff’s additional claims.4 As relevant
here, Tender Heart sought summary adjudication on the ground that it was a non-
employer employment agency pursuant to Civil Code section 1812.5095, subdivision (b),
and, alternatively, on the ground that Plaintiff was an independent contractor, not an
employee of Tender Heart.
4
The parties characterize these additional claims as derivative of the DWBR claim.
Because no party contends a different analysis applies to the derivative claims, we do not
discuss them separately.
4
The trial court denied summary adjudication on the first ground, finding Tender
Heart failed to comply with all of the statutory requirements for non-employer
employment agencies. However, the court granted summary adjudication on the second
ground, applying the Borello standard for distinguishing between employees and
independent contractors, and concluding the undisputed facts established Plaintiff was an
independent contractor.
The court subsequently granted Tender Heart’s separate motion for summary
adjudication on Plaintiff’s remaining claims. Judgment issued for Tender Heart, and this
appeal followed.5
DISCUSSION
I. Standard of Review
“Summary adjudication motions are ‘procedurally identical’ to summary judgment
motions. [Citation.] A summary judgment motion ‘shall be granted if all the papers
submitted show that there is no triable issue as to any material fact and that the moving
party is entitled to a judgment as a matter of law.’ [Citation.] To be entitled to judgment
as a matter of law, the moving party must show by admissible evidence that the ‘action
has no merit or that there is no defense’ thereto. [Citation.] A defendant moving for
summary judgment meets this burden by presenting evidence demonstrating that one or
more elements of the cause of action cannot be established or that there is a complete
defense to the action. [Citations.] Once the defendant makes this showing, the burden
shifts to the plaintiff to show that a triable issue of material fact exists as to that cause of
action or defense. [Citations.] Material facts are those that relate to the issues in the case
as framed by the pleadings. [Citation.] There is a genuine issue of material fact if, and
only if, the evidence would allow a reasonable trier of fact to find the underlying fact in
5
Plaintiff does not challenge on appeal the trial court’s second summary adjudication
order on her non-DWBR claims. Tender Heart argues Plaintiff’s opening brief on appeal
fails to comply with California Rules of Court, rule 8.204(a)(2)(C). We exercise our
discretion to disregard any noncompliance. (Id., rule 8.204(e)(2)(C).)
5
favor of the party opposing the motion in accordance with the applicable standard of
proof.” (Serri v. Santa Clara University (2014) 226 Cal. App. 4th 830, 859–860 (Serri).)
“The trial court’s ruling on a motion for summary adjudication, like that on a
motion for summary judgment, is subject to this court’s independent review.” (Serri,
supra, 226 Cal.App.4th at p. 858.) “In performing our review, we view the evidence in a
light favorable to the losing party . . . , liberally construing her evidentiary submission
while strictly scrutinizing the moving party’s own showing and resolving any evidentiary
doubts or ambiguities in the losing party’s favor.” (Id. at p. 859.)6
II. Independent Contractor or Employee
The DWBR’s overtime provision applies to “domestic work employee[s].”
(§ 1454.) Tender Heart contends Plaintiff was not an employee, but instead was an
independent contractor to whom the overtime requirement did not apply.7
6
Tender Heart argues Plaintiff submitted only minimal evidence in opposition to its
summary adjudication motion and suggests she therefore failed to demonstrate a dispute
of fact; Tender Heart further contends Plaintiff waived any argument that Tender Heart’s
evidence did not satisfy its initial burden on summary adjudication. The quantity of
Plaintiff’s opposition evidence and any failure to expressly contest Tender Heart’s initial
burden are of no moment. “The fact no opposition [to a summary judgment motion] has
been filed does not relieve the judge (or the appellate court) from the duty to draw all
inferences reasonably deducible from the evidence before the court.” (Weil & Brown,
Cal. Practice Guide: Civil Procedure Before Trial (The Rutter Group 2018) ¶ 10:303,
p. 10-138.) The moving party’s evidence alone may establish a triable issue of fact. (See
id., ¶ 10:304, p. 10-138 [“The opposing party has no burden to controvert the moving
party’s declarations if such declarations themselves, through inferences reasonably drawn
therefrom, disclose a ‘triable issue’ of fact.”].) Finally, although both parties cite
evidence submitted in connection with Tender Heart’s second summary adjudication
motion on non-DWBR claims, we cannot and do not consider such evidence, which was
not before the trial court at the time of the challenged order. (California Farm Bureau
Federation v. State Water Resources Control Bd. (2011) 51 Cal. 4th 421, 442 [“ ‘[I]t has
long been the general rule and understanding that “an appeal reviews the correctness of a
judgment as of the time of its rendition, upon a record of matters which were before the
trial court for its consideration.” ’ ”].)
7
Tender Heart contends some claims in Plaintiff’s complaint were impermissibly
factually inconsistent with the DWBR claims because, as to the remaining claims,
Plaintiff did not incorporate the factual allegation that she was Tender Heart’s employee.
6
A. What Standard Applies
Plaintiff argues the trial court erred in applying the standard articulated in Borello
to determine whether Plaintiff was an independent contractor or an employee. Instead,
Plaintiff contends, the appropriate standard is the one set forth in the DWBR itself.
Tender Heart argues the trial court properly applied the Borello standard. We agree with
Plaintiff that we must look to the DWBR for the applicable standard.
In Dynamex Operations West, Inc. v. Superior Court (2018) 4 Cal.5th 903
(Dynamex), our Supreme Court recently provided “a historical review of the treatment of
the employee or independent contractor distinction under California law.” (Id. at p. 927.)
The court began with a discussion of the common law origins of the distinction. “[A]t
common law the problem of determining whether a worker should be classified as an
employee or an independent contractor initially arose in the tort context—in deciding
whether the hirer of the worker should be held vicariously liable for an injury that
resulted from the worker’s actions. In the vicarious liability context, the hirer’s right to
supervise and control the details of the worker’s actions was reasonably viewed as
crucial, because ‘ “[t]he extent to which the employer had a right to control [the details of
the service] activities was . . . highly relevant to the question whether the employer ought
to be legally liable for them . . . .” ’ [Citation.] For this reason, the question whether the
hirer controlled the details of the worker’s activities became the primary common law
standard for determining whether a worker was considered to be an employee or an
independent contractor.” (Ibid.)
To the extent the contention is relevant to the issue before us, we reject it. That Plaintiff
did not incorporate the allegation in some causes of action is not inconsistent with the
presence of the allegation elsewhere in the complaint; in any event, whether Plaintiff was
an employee is a legal conclusion, not a fact. (See Weil & Brown, Cal. Practice Guide:
Civil Procedure Before Trial, supra, ¶¶ 6:247.1, 6:248, p. 6-79 [“For the bar on
inconsistent fact pleading to apply, the facts must be ‘antagonistic,’ ” and the bar “applies
to facts, not legal conclusions to be drawn from the facts (such as whether the parties had
an agency relationship or instead that of buyer and seller).”].)
7
Dynamex then discussed Borello, supra, 48 Cal. 3d 341, which considered the
distinction between independent contractors and employees “for purposes of the
California workers’ compensation statutes.” (Dynamex, supra, 4 Cal.5th at p. 929.)
Borello explained “that ‘the concept of “employment” embodied in the [workers’
compensation act] is not inherently limited by common law principles’ ” and instead
“ ‘must be construed with particular reference to the “history and fundamental
purposes” of the statute.’ ” (Dynamex, at p. 930 [quoting Borello, at p. 351].) While
Borello applied the common law “ ‘ “control-of-work-details” test,’ ” identifying multiple
relevant factors to consider, it held that test “ ‘must be applied with deference to the
purposes of the protective legislation.’ ” (Dynamex, at pp. 930–932 [quoting Borello, at
pp. 353–354].) Dynamex concluded that, “although we have sometimes characterized
Borello as embodying the common law test or standard for distinguishing employees and
independent contractors [citation], it appears more precise to describe Borello as calling
for resolution of the employee or independent contractor question by focusing on the
intended scope and purposes of the particular statutory provision or provisions at issue.
In other words, Borello calls for application of a statutory purpose standard that considers
the control of details and other potentially relevant factors identified in prior California
and out-of-state cases in order to determine which classification (employee or
independent contractor) best effectuates the underlying legislative intent and objective of
the statutory scheme at issue.” (Dynamex, at p. 934.)
Dynamex next considered Martinez v. Combs (2010) 49 Cal. 4th 35 (Martinez),
which “address[ed] the meaning of the terms ‘employ’ and ‘employer’ as used in
California wage orders” promulgated by the IWC. (Dynamex, supra, 4 Cal.5th at p. 935.)
The wage orders provide that “ ‘ “[e]mploy” means to engage, suffer, or permit to
work’ ” and “ ‘ “[e]mployer” means any person . . . who directly or indirectly, or through
an agent or any other person, employs or exercises control over the wages, hours, or
working conditions of any person.’ ” (Id. at p. 926 & fn. 9.) Martinez concluded the
wage orders set forth “ ‘three alternative definitions’ ” for employment. (Dynamex, at
p. 938 [quoting Martinez, at p. 64].) The first—“suffer[] or permit to work”—derived
8
from early child labor statutes, and “had been interpreted to impose liability upon an
entity ‘even when no common law employment relationship existed . . . .’ ” (Dynamex,
at p. 937 [quoting Martinez, at p. 58].) The second—“control over the wages, hours, or
working conditions”—“ ‘has no clearly identified, precisely literal statutory or common
law antecedent,’ ” but by its terms encompassed joint employer scenarios and was
intended to “provid[e] workers with greater protection” than federal labor laws.
(Dynamex, at pp. 937–938 [quoting Martinez, at pp. 59–60].) The third alternative
definition—“to engage”—“ ‘has no other apparent meaning in the present context than its
plain, ordinary sense of “to employ,” that is, to create a common law employment
relationship.’ ” (Dynamex, at p. 938 [quoting Martinez, at p. 64].) As explained in
Dynamex, “the court in Martinez . . . took pains to emphasize the importance of not
limiting the meaning and scope of ‘employment’ to only the common law definition for
purposes of the IWC’s wage orders, declaring that ‘ignoring the rest of the IWC’s broad
regulatory definition would substantially impair the commission’s authority and the
effectiveness of its wage orders. . . . Were we to define employment exclusively
according to the common law in civil actions for unpaid wages we would render the
commission’s definitions effectively meaningless.’ ” (Dynamex, at pp. 938–939 [quoting
Martinez, at p. 65].)
In Dynamex itself, the Supreme Court interpreted the “suffer or permit” language
in the wage orders. (Dynamex, supra, 4 Cal.5th at p. 943.) After considering the history
and interpretation of the language, the Supreme Court concluded “it is appropriate, and
most consistent with the history and purpose of the suffer or permit to work standard in
California’s wage orders, to interpret that standard as: (1) placing the burden on the
hiring entity to establish that the worker is an independent contractor who was not
intended to be included within the wage order’s coverage; and (2) requiring the hiring
entity, in order to meet this burden, to establish each of the three factors embodied in the
ABC test—namely (A) that the worker is free from the control and direction of the hiring
entity in connection with the performance of the work, both under the contract for the
performance of the work and in fact; and (B) that the worker performs work that is
9
outside the usual course of the hiring entity’s business; and (C) that the worker is
customarily engaged in an independently established trade, occupation, or business of the
same nature as the work performed.” (Id. at pp. 956–957, fn. omitted.)
Dynamex thus “recognized that different standards could apply to different
statutory claims.” (Garcia v. Border Transportation Group, LLC (2018) 28 Cal.App.5th
558, 570.) “[S]tatutory purpose [is] the touchstone for deciding whether a particular
category of workers should be considered employees rather than independent contractors
for purposes of social welfare legislation.” (Dynamex, supra, 4 Cal.5th at p. 935.) We
therefore conclude that the distinction between independent contractor and employer for
purposes of the DWBR must be determined by examining the language and purpose of
the DWBR itself.8
B. The DWBR
The DWBR’s sole substantive provision provides: “A domestic work employee
who is a personal attendant shall not be employed more than nine hours in any workday
or more than 45 hours in any workweek unless the employee receives one and one-half
times the employee’s regular rate of pay for all hours worked over nine hours in any
workday and for all hours worked more than 45 hours in the workweek.” (§ 1454.)9
8
Tender Heart’s reliance on Linton v. Desoto Cab Company, Inc. (2017) 15 Cal.App.5th
1208 (Linton), which applied Borello’s test to determine whether the plaintiff was an
employee or independent contractor for purposes of his Labor Code claims, is unavailing.
Linton issued while Dynamex was pending, and a concurring justice noted that “as the
parties have briefed and argued the matter, we are concerned only with the scope of the
common law test” and not with “whether the ‘additional tests for employee status’ set
forth in wage orders apply to wage claim cases [citation], an issue now pending before
the court in Dynamex . . . .” (Linton, at p. 1226 & fn. 1 (conc. opn. of Banke, J.).)
Tender Heart’s reliance on Reynolds v. Bement (2005) 36 Cal. 4th 1075 is similarly
unpersuasive, in light of Martinez’s limitation of its holding. (Martinez, supra, 49
Cal.4th at pp. 62–66.)
9
The DWBR also requires the Governor to convene a committee to study the effects of
the DWBR “on personal attendants and their employers.” (§ 1453.) A provision in the
original bill sunsetting the DWBR in 2017 was subsequently repealed. (Former § 1453
[enacted by stats. 2013, ch. 374, § 1; repealed by stats. 2016, ch. 315, § 1].)
10
“ ‘Personal attendant’ means any person employed by a private householder or by any
third-party employer recognized in the health care industry to work in a private
household, to supervise, feed, or dress a child, or a person who by reason of advanced
age, physical disability, or mental deficiency needs supervision. The status of personal
attendant shall apply when no significant amount of work other than the foregoing is
required. For purposes of this subdivision, ‘no significant amount of work’ means work
other than the foregoing did not exceed 20 percent of the total weekly hours worked.”
(§ 1451, subd. (d).)10 The DWBR’s definition of personal attendant appears designed to
precisely match those employees excluded from Wage Order 15’s overtime provision.
(See Wage Order 15, Cal. Code Regs., tit. 8, § 11150, subds. 1(B), 2(J), 3(C) [excluding
“personal attendants” from overtime protections, defined as “any person employed by a
private householder or by any third party employer recognized in the health care industry
to work in a private household, to supervise, feed, or dress a child or person who by
reason of advanced age, physical disability, or mental deficiency needs supervision. The
status of personal attendant shall apply when no significant amount of work other than
the foregoing is required.”]; Guerrero v. Superior Court (2013) 213 Cal. App. 4th 912,
956 [noting the Department of Labor Standards Enforcement has issued a formal opinion
letter stating that “a ‘significant amount’ of work . . . is that exceeding 20 percent of the
total hours worked”].)
The DWBR provides the following additional definitions. “ ‘Domestic work
employee’ means an individual who performs domestic work[11] and includes live-in
domestic work employees and personal attendants.” (§ 1451, subd. (b)(1).) The statute
lists several exceptions not relevant here, including close relatives and casual babysitters.
10
Tender Heart does not dispute that Plaintiff was a personal attendant within the
meaning of the DWBR.
11
“ ‘Domestic work’ means services related to the care of persons in private households
or maintenance of private households or their premises. Domestic work occupations
include childcare providers, caregivers of people with disabilities, sick, convalescing, or
elderly persons, house cleaners, housekeepers, maids, and other household occupations.”
(§ 1451, subd. (a)(1).)
11
(§ 1451, subd. (b)(2).) “ ‘Domestic work employer’ means a person, including corporate
officers or executives, who directly or indirectly, or through an agent or any other person,
including through the services of a third-party employer, temporary service, or staffing
agency or similar entity, employs or exercises control over the wages, hours, or working
conditions of a domestic work employee.” (§ 1451, subd. (c)(1).)12 Again, the statute
sets forth several exceptions, including, as we will discuss in more detail post, part III,
employment agencies that meet certain specifications. (§ 1451, subd. (c)(2).) The
DWBR does not define the term “employ” or include a definition of “independent
contractor.”
As an initial matter, we observe that the DWBR’s definition of employer differs
from that of the wage orders. In one respect—albeit one not relevant here—the DWBR is
broader: it expressly includes “corporate officers or executives” in the definition of
employer, while “the IWC’s definition of ‘employer’ does not impose liability on
individual corporate agents acting within the scope of their agency.” (Martinez, supra,
49 Cal.4th at p. 66.) In another respect, the DWBR’s definition of employer appears to
be narrower: the DWBR does not include the “suffer or permit” definition set forth in the
wage orders and analyzed in Dynamex.13
Although the DWBR’s definition of employer differs from that of the wage orders
in some respects, it includes one of the wage orders’ alternative definitions verbatim: a
person who “exercises control over the wages, hours, or working conditions” of a worker.
12
While the DWBR takes care to define “domestic work employer,” its overtime
provision does not use the term. In Martinez, the Supreme Court held that section 1194,
which gives “an employee a cause of action for unpaid minimum wages without
specifying who is liable,” only renders employers liable: “That only an employer can be
liable . . . seems logically inevitable as no generally applicable rule of law imposes on
anyone other than an employer a duty to pay wages.” (Martinez, supra, 49 Cal.4th at
p. 49.) We similarly conclude that only a domestic work employer can be liable for
unpaid overtime wages required by the DWBR. No party suggests otherwise.
13
An earlier version of the bill defined the term “[h]ours worked” to include “all time the
domestic work employee is suffered or permitted to work . . . .” (Assem. Bill No. 241
(2013–2014 Reg. Sess.) as amended Mar. 19, 2013, § 2.)
12
While Dynamex expressly declined to consider this standard (Dynamex, supra, 4 Cal.5th
at p. 943), Martinez observed the language “has the obvious utility of reaching situations
in which multiple entities control different aspects of the employment relationship, as
when one entity, which hires and pays workers, places them with other entities that
supervise the work. Consistently with this observation, the IWC has explained its
decision to include the language in one modern wage order as ‘specifically intended to
include both temporary employment agencies and employers who contract with such
agencies to obtain employees within the definition of “employer.” ’ ” (Martinez, supra,
49 Cal.4th at p. 59.)
“It is a settled principle of statutory construction that the Legislature ‘ “is deemed
to be aware of statutes and judicial decisions already in existence, and to have enacted or
amended a statute in light thereof. [Citation.]” [Citation.]’ [Citation.] Courts may
assume, under such circumstances, that the Legislature intended to maintain a consistent
body of rules and to adopt the meaning of statutory terms already construed.” (People v.
Scott (2014) 58 Cal. 4th 1415, 1424.) We see no reason why a different principle would
apply to judicial construction of wage orders. (See Dynamex, supra, 4 Cal.5th at p. 914,
fn. 3 [“In California, wage orders are constitutionally-authorized, quasi-legislative
regulations that have the force of law.”].) Accordingly, we presume the Legislature, in
using the term “control of the wages, hours, or working conditions” in enacting the
DWBR in 2013, intended to incorporate the meaning of that term as set forth in the
Supreme Court’s 2010 Martinez decision.14
14
In Dynamex, the Supreme Court declined to determine whether the control over wages,
hours, or working conditions definition applies “only in circumstances in which the
question at issue is whether, when workers are ‘admitted employees’ of one business (the
primary employer), a business entity that has a relationship to the primary employer
should also be considered an employer of the workers such that it is jointly responsible
for the obligations imposed by the wage order.” (Dynamex, supra, 4 Cal.5th at p. 943.)
We follow the “number of post-Martinez Court of Appeal decisions recognizing that the
definitions of ‘employ’ and ‘employer’ discussed in Martinez now govern the resolution
of claims arising out of California wage orders, including whether a worker is an
employee or independent contractor.” (Dynamex, at p. 947.)
13
The Legislature’s use of this definition indicates it wanted to ensure that all joint
employers of domestic workers are liable, including “ ‘temporary employment
agencies’ ” (Martinez, supra, 49 Cal.4th at p. 59). Other indicia of this intent are also
present. Notably, in providing certain employment agencies were not domestic work
employers for purposes of the DWBR, the Legislature provided that only those
employment agencies meeting “all of the factors” in a lengthy and detailed list of
requirements are not employers. (§ 1451, subd. (c)(2)(B), italics added; see part III,
post.) The narrowness and specificity of this exception indicates the Legislature intended
those employment agencies that do not meet all of the requirements may well be
considered employers for purposes of the DWBR. As a Court of Appeal considering a
statute providing that the same requirements render a domestic work employment agency
not an employer for purposes of workers’ compensation law reasoned, “Domestic
workers that would potentially fall within the confines of [the statutory exception] are
free to assert that they are employees of an employment agency for workers’
compensation purposes because it has not complied with the requirements of that section
and therefore is considered an employer.” (An Independent Home Support Service, Inc.
v. Superior Court (2006) 145 Cal. App. 4th 1418, 1431 (An Independent Home).) In
addition, legislative analyses noted proponents’ arguments that “[e]ven domestic workers
employed by agencies labor in individual homes and deserve equal rights and labor
protections.” (Sen. Rules Com., Off. of Sen. Floor Analyses, 3d reading analysis of
Assem. Bill No. 241 (2013–2014 Reg. Sess.) as amended Sept. 3, 2013, p. 9.)
In addition to the control over wages, hours, or working conditions definition, the
DWBR also defines a domestic work employer as one who “employs” a domestic work
employee. (§ 1451, subd. (c)(1) [domestic work employer “employs or exercises control
over the wages, hours, or working conditions of a domestic work employee” (italics
added)].) Martinez held “ ‘to employ’ ”—absent an express definition, such as the one
set forth in the wage orders—means “to create a common law employment relationship.”
(Martinez, supra, 49 Cal.4th at p. 64.) The DWBR thus also incorporates the common
law definition of employment.
14
We turn now to the purpose of the statute. In Dynamex, the Supreme Court
discussed the general worker-protective purpose behind wage and hour legislation, such
as the DWBR. “Wage and hour statutes and wage orders were adopted in recognition of
the fact that individual workers generally possess less bargaining power than a hiring
business and that workers’ fundamental need to earn income for their families’ survival
may lead them to accept work for substandard wages or working conditions. The basic
objective of wage and hour legislation and wage orders is to ensure that such workers are
provided at least the minimal wages and working conditions that are necessary to enable
them to obtain a subsistence standard of living and to protect the workers’ health and
welfare.” (Dynamex, supra, 4 Cal.5th at p. 952.) Dynamex noted such statutes are
“primarily for the benefit of the workers themselves,” but also benefitted “law-abiding
businesses that comply with the obligations imposed by the wage orders, ensuring that
such responsible companies are not hurt by unfair competition from competitor
businesses that utilize substandard employment practices,” as well as “the public at large,
because if the wage orders’ obligations are not fulfilled the public will often be left to
assume responsibility for the ill effects to workers and their families resulting from
substandard wages or unhealthy and unsafe working conditions.” (Id. at pp. 952–953.)
These purposes are echoed in the legislative history of the DWBR. Legislative
analyses acknowledged that “domestic workers are largely excluded from some of the
more basic protections afforded to other workers under state and federal law, including
the rights to overtime wages, meal and rest period rights and safe and healthy working
conditions.” (Sen. Rules Com., Off. of Sen. Floor Analyses, 3d reading analysis of
Assem. Bill No. 241 (2013–2014 Reg. Sess.) as amended Sept. 6, 2013, p. 2; see also
Assem. Floor Analysis, Conc. in Sen. Amends. to Assem. Bill No. 241 (2013–2014 Reg
Sess.) as amended Sept. 6, 2013, p. 2 (hereafter, Assem. Floor Analysis).) A committee
report quoted studies stating that “ ‘household workers frequently find themselves
working in substandard and often exploitative conditions, earning poverty wages too low
to support their own families, and lacking access to basic health care.’ ” (Assem. Labor
& Employment Com., Analysis of Assem. Bill. No. 241 (2013–2014 Reg. Sess.) as
15
amended Mar. 19, 2013, p. D; see also Sen. Rules Com., Off. of Sen. Floor Analyses, 3d
reading analysis of Assem. Bill No. 241 (2013–2014 Reg. Sess.) as amended Sept. 3,
2013, p. 9 [“The author’s office notes that domestic workers are among the most isolated
and vulnerable workforce in the state.”].) The bill’s sponsor explained: “ ‘The campaign
to adopt a California Domestic Worker Bill of Rights attempts to address one core
principle: domestic workers deserve equal treatment under the law. Unfortunately,
California suffers from a unique and confounding contradiction: Domestic workers who
care for property such as landscaping or housekeeping are generally entitled to overtime.
Those domestic workers who care for children, the infirm, the elderly, and those with
disabilities do not. The California Domestic Worker Bill of Rights attempts to correct
this injustice.’ ” (Assem. Floor Analysis, p. 2.)15
Dynamex noted the “general principle that wage orders are the type of remedial
legislation that must be liberally construed in a manner that serves its remedial purposes,”
and further found the worker-protective purposes of the wage orders “support a very
broad definition of the workers who fall within the reach of the wage orders.” (Dynamex,
supra, 4 Cal.5th at pp. 952–953.) Because similar objectives underlie the DWBR, we
conclude the DWBR’s provisions governing which domestic workers are covered by its
overtime requirement must be liberally construed. We bear in mind the Supreme Court’s
recent observation: “Although in some circumstances classification as an independent
contractor may be advantageous to workers as well as to businesses, the risk that workers
who should be treated as employees may be improperly misclassified as independent
contractors is significant in light of the potentially substantial economic incentives that a
business may have in mischaracterizing some workers as independent contractors. Such
incentives include the unfair competitive advantage the business may obtain over
15
Earlier versions of the bill included additional protections for domestic workers, such
as meal and rest breaks and paid vacation days. (See Assem. Bill No. 241 (2013–2014
Reg. Sess.) as amended Mar. 19, 2013.) These additional protections were removed in
later amendments, leaving the overtime requirement as the only substantive protection in
the final bill. (See Assem. Floor Analysis, p. 1.)
16
competitors that properly classify similar workers as employees and that thereby assume
the fiscal and other responsibilities and burdens that an employer owes to its employees.”
(Dynamex, at p. 913.)
Finally, the DWBR does not identify which party bears the burden of proof in
determining whether the worker is an employee or an independent contractor. The
workers’ compensation law provides “that ‘[a hiring business] seeking to avoid liability
has the burden of proving that persons whose services [the business] has retained are
independent contractors rather than employees.’ [Citation.] Moreover, the rule that a
hiring entity has the burden of establishing that a worker is an independent contractor
rather than an employee has long been applied in California decisions outside the
workers’ compensation context.” (Dynamex, supra, 4 Cal.5th at p. 958, fn. 24; see also
Linton, supra, 15 Cal.App.5th at p. 1221 [“the rebuttable presumption of employment in
[the workers’ compensation laws] applies to actions brought under Labor Code
provisions falling outside workers’ compensation”].) In light of the liberal construction
we afford the DWBR, we conclude the burden should fall with the hiring entity to prove
that a domestic worker is an independent contractor not entitled to the overtime
protection of the DWBR.
In sum, the DWBR contains two alternative definitions of employment for
purposes of its provisions: (1) when the hiring entity exercises control over the wages,
hours, or working conditions of a domestic worker; or (2) when a common law
employment relationship has been formed. Both definitions must be construed broadly in
light of the purposes of the DWBR, and the hiring entity bears the burden of establishing
that a domestic worker is an independent contractor rather than an employee.
C. Application to This Case
We now apply these tests to the case at hand, construing, as we must, “the
evidence in a light favorable to the losing party . . . , liberally construing her evidentiary
submission while strictly scrutinizing the moving party’s own showing and resolving any
evidentiary doubts or ambiguities in the losing party’s favor.” (Serri, supra, 226
Cal.App.4th at p. 859.)
17
1. Control Over Wages, Hours, or Working Conditions16
“ ‘[C]ontrol over wages’ means that a person or entity has the power or authority
to negotiate and set an employee’s rate of pay . . . .” (Futrell v. Payday California, Inc.
(2010) 190 Cal. App. 4th 1419, 1432 (Futrell).) Thus, in Martinez, the Supreme Court
rejected the argument that an entity contracting with the plaintiffs’ employer exercised
control over the plaintiffs’ wages (and was thus a joint employer), in part because the
plaintiffs’ employer “alone . . . determined their rate and manner of pay (hourly or piece
rate) . . . .” (Martinez, supra, 49 Cal.4th at p. 72.) In Futrell, the Court of Appeal found
a payroll processing company, simply by “handling the ministerial tasks of calculating
pay and tax withholding, and by also issuing paychecks, drawn on its own bank account,”
did not exercise control over a worker’s wages. (Futrell, at p. 1432.)
The Client Contract17 attaches a rate sheet listing the “total combined negotiated
caregiver and agency fees based on standard services for one client.”18 Horvath testified
16
Tender Heart contends that, at the hearing below, Plaintiff only argued Tender Heart
exercised control by retaining the ability to refuse further referrals, and that Plaintiff has
therefore waived any other “theories of ‘control.’ ” In Plaintiff’s opposition brief below,
she contended Tender Heart controlled her wages and hours; she also argued she was an
employee under Borello’s multi-factor test. Plaintiff’s arguments on appeal are
preserved.
17
Tender Heart notes that the Client Contract is “subject to preserved evidentiary
objections” and provides a record citation to the objection it filed in the trial court. The
trial court did not rule on the objection and it is thus presumptively overruled and “can
still be raised on appeal,” however, “the burden [is] on the objector to renew the
objections in the appellate court.” (Reid v. Google, Inc. (2010) 50 Cal. 4th 512, 534.)
Tender Heart’s record citation to its objection below, without advancing any argument on
the evidentiary issue in its appellate brief, is not sufficient to raise the issue on appeal.
(Serri, supra, 226 Cal.App.4th at p. 854 [“It is inappropriate for an appellate brief to
incorporate by reference arguments contained in a document filed in the trial court.
[Citation.] Such practice does not comply with the requirement that an appellate brief
‘support each point by argument and, if possible, by citation of authority.’ ”].) We note
that Horvath testified the Client Contract in evidence was the standard contract Tender
Heart had been using for at least several years.
18
the Client Contract rate sheet was a starting point but the ultimate rate charged to a given
client “does fluctuate, depending upon the needs and depending upon how complicated
those needs are, and the clients often . . . . want to negotiate a lower rate.” The Caregiver
Contract similarly attaches Tender Heart’s “fee schedule” listing caregiver pay rates.19
As with the client rate sheet, the caregiver pay rates may vary: the caregiver pay rate
sheet includes the express disclaimer that “rates are subject to variation due to client need
and financial limitations.”
Caregivers are paid a portion of the amount Tender Heart bills to clients. The
caregiver’s portion does not appear to be a set percentage of the client rate, or any other
fixed formula in connection to the client’s rate. For example, the standard rates provide
that a client pay $19.75 per hour for a shift of four or more hours. However, the standard
caregiver rates provide that a caregiver will receive $13 per hour for a shift of four to
seven hours, $12 per hour for a shift of eight to ten hours, and $11 per hour for a shift of
ten or more hours. There is no evidence in the record as to how the caregiver’s pay rate
is set when the client rate is higher or lower than the standard rate. Plaintiff testified in
her deposition that when Tender Heart told her about a caregiving opportunity, “I would
get an e-mail and there would be a rate that I would be getting paid for that job.”
The Caregiver Contract provides the “[c]aregiver is free to negotiate with the
client the amount proposed to be paid for services.” However, immediately following
this sentence, the Caregiver Contract states: “Fees for temporary employment shall be
paid in accordance with the fee schedule unless” the caregiver has agreed to have certain
initial costs (for a background check and liability insurance) paid through payroll
deductions. (Italics added.) The Client Contract provides: “In the event the required
18
The client rate sheet lists the hourly rates for two hours as $27 per hour, three hours as
$24 per hour, and four or more hours as $19.75 per hour. The rate sheet also provides
flat rates for night shifts and 24-hour shifts.
19
The caregiver pay rate sheet lists the hourly pay rate for two to three hours is $15 per
hour, for four to seven hours is $13 per hour, for eight to ten hours is $12 per hour, and
for more than ten hours is $11 per hour. The caregiver pay rate sheet also includes flat
rates for night shifts and 24-hour shifts.
19
services are more involved than initially assessed or represented, or service is to be
provided to more than one individual, the caregiver reserves the right to adjust the rates
accordingly. An additional client on the premises normally is assessed a surcharge of 1.5
times the prevailing base rate.”
Horvath testified that caregivers may “want to negotiate a higher rate” and “we
negotiate for the caregivers . . . .” In her deposition, Plaintiff testified she sometimes
asked Tender Heart for a higher pay rate. She did not feel free to talk to clients directly
about her pay rate, although she had not specifically been directed not to do so. Plaintiff
testified about rate negotiations with a particular client, as follows:
“Q. And during the course of providing caregiver services for that person, you wanted a
change in your rate?
“A. Yes.
“Q. And do you recall talking to the daughter about that?
“A. No. I talked to the agency first.
“Q. And then at some point, you talked to the daughter directly?
“A. She came to me and I let her know, you know, I’m caring for both of your parents
now, so, you know, doing their total care, so it makes sense.
“Q. You had no problem talking to them directly about the rate?
“A. No, I didn’t talk to her about any rate. I just let her know that I believe I deserved a
raise, because I’m taking care of both of her parents, and this was after I talked to the
agency first.
“Q. And did the daughter agree to that?
“[Plaintiff’s counsel]: Agree to what?
“[Tender Heart’s counsel]: The change in rate.
“[Plaintiff]: She spoke to the agency and they discussed, to where it should go, and then
the agency reached out to me, to ask me where [I] think it should go. And I told them
initially, I don’t know, I wasn’t -- I don’t know.
“[Tender Heart’s counsel]: At some point did you discuss what you wanted as a rate with
someone?
20
“A. Yes.
“Q. And was that honored?
“A. They would get back to me on what they could get from the client.
“Q. Okay. And then, after that, was your request honored?
“A. It met in the middle somehow.
“Q. Was that agreeable with you?
“A. It was what I was able to get paid.”
Construing the above evidence in the light most favorable to Plaintiff, a factfinder
could find as follows. Tender Heart negotiates with the client about the initial rates the
client will pay, and then unilaterally determines what portion of that rate the caregiver
will receive. Caregivers can seek higher pay for a given client only, as set forth in the
Client Contract, when “the required services are more involved than initially assessed or
represented.” Moreover, caregivers cannot negotiate their pay directly with the client,
but must request that Tender Heart do so. If Tender Heart does renegotiate the rate with
the client, it then determines, again unilaterally, what portion of the increased rate will go
to the caregiver. We conclude Plaintiff demonstrated a dispute of fact over whether
Tender Heart exercised “the power or authority to negotiate and set [Plaintiff’s] rate of
pay,” and thereby exercised control over her wages. (Futrell, supra, 190 Cal.App.4th at
p. 1432.)
Plaintiff also contends Tender Heart exercised control over her hours, citing
evidence that Tender Heart would inform Plaintiff of the hours of an offered shift. The
evidence is undisputed that Plaintiff could refuse any offered shift. We therefore
conclude the undisputed facts demonstrate Tender Heart did not control Plaintiff’s hours.
Plaintiff does not contend Tender Heart exercised control over her working conditions.
However, as Martinez observed, this definition of employment is “phrased . . . in the
alternative (i.e., ‘wages, hours, or working conditions),” and thus control over any one of
the three creates an employment relationship. (Martinez, supra, 49 Cal.4th at p. 59.)
Plaintiff has thus established a dispute of fact as to whether Tender Heart was her
employer because it exercised control over her wages.
21
2. Common Law
We also consider whether there is a fact dispute as to whether Plaintiff was an
employee under the common law, construing the factors identified in Borello in light of
the worker-protective purposes of the DWBR. These factors include those employed in
prior California cases: “(a) whether the one performing services is engaged in a distinct
occupation or business; (b) the kind of occupation, with reference to whether, in the
locality, the work is usually done under the direction of the principal or by a specialist
without supervision; (c) the skill required in the particular occupation; (d) whether the
principal or the worker supplies the instrumentalities, tools, and the place of work for the
person doing the work; (e) the length of time for which the services are to be performed;
(f) the method of payment, whether by the time or by the job; (g) whether or not the work
is a part of the regular business of the principal; . . . (h) whether or not the parties believe
they are creating the relationship of employer-employee”; and (i) “ ‘the right to discharge
at will, without cause.’ ” (Borello, supra, 48 Cal.3d at pp. 350–351.) They also include a
six-factor test developed by other jurisdictions: “(1) the alleged employee’s opportunity
for profit or loss depending on his managerial skill; (2) the alleged employee’s
investment in equipment or materials required for his task, or his employment of helpers;
(3) whether the service rendered requires a special skill; (4) the degree of permanence of
the working relationship; . . . (5) whether the service rendered is an integral part of the
alleged employer’s business”; and (6) “the ‘right to control the work.’ ” (Id. at pp. 354–
355.)
The facts of Borello itself are instructive. The workers in Borello were
“agricultural laborers engaged to harvest cucumbers under a written ‘sharefarmer’
agreement” with Borello, a grower of multiple crops, including cucumbers. (Borello,
supra, 48 Cal.3d at pp. 345, 347.) The workers “arrive around ‘2–3 weeks’ before the
harvest begins,” “contract for the amount of land they wish to harvest,” and “are ‘totally
responsible’ for the care of the plants in their assigned plots during the harvest period.”
(Id. at p. 347.) They set their own hours and Borello does not supervise or direct them.
(Ibid.) They are paid based on a share of the gross proceeds. (Id. at p. 346.) After
22
considering multiple factors, the Supreme Court found the workers were employees, not
independent contractors, for purposes of the workers’ compensation laws. (Id. at p. 360.)
The Supreme Court first considered that “Borello, whose business is the
production and sale of agricultural crops, exercises ‘pervasive control over the operation
as a whole.’ [Citation.] Borello owns and cultivates the land for its own account.
Without any participation by the sharefarmers, Borello decides to grow cucumbers,
obtains a sale price formula from the only available buyer, plants the crop, and cultivates
it throughout most of its growing cycle. The harvest takes place on Borello’s premises, at
a time determined by the crop’s maturity. During the harvest itself, Borello supplies the
sorting bins and boxes, removes the harvest from the field, transports it to market, sells it,
maintains documentation on the workers’ proceeds, and hands out their checks. Thus,
‘[a]ll meaningful aspects of this business relationship: price, crop cultivation, fertilization
and insect prevention, payment, [and] right to deal with buyers . . . are controlled by
[Borello].’ ” (Borello, supra, 48 Cal.3d at p. 356, fn. omitted.) The Supreme Court
additionally found the workers “form a regular and integrated portion of Borello’s
business operation. Their work, though seasonal by nature, is ‘permanent’ in the
agricultural process. . . . This permanent integration of the workers into the heart of
Borello’s business is a strong indicator that Borello functions as an employer under the
[Workers’ Compensation] Act.” (Id. at p. 357.)
While a caregiving business has fewer operational details to control than that of a
cucumber grower, there is evidence that Tender Heart selects clients, performs the initial
assessment of the clients’ needs, matches caregivers according to the clients’ needs,
negotiates the amount charged to the client, and determines what portion of that amount
will be paid to the caregiver. These facts, if established, constitute substantial control
over the details of the caregiving business. Tender Heart protests that it is not in the
business of caregiving, but is simply a referral agency. There is evidence that its business
is to enter into contracts with clients for the provision of caregivers matched to that
client’s needs, as determined by Tender Heart’s assessment. Absent the caregivers,
Tender Heart could not fulfill its contracts with clients and therefore could not operate its
23
business. As in Borello, there is evidence the caregivers “form a regular and integrated
portion of [Tender Heart’s] business operation.” (Borello, supra, 48 Cal.3d at p. 357, see
also Linton, supra, 15 Cal.App.5th at p. 1223 [“The work [the plaintiff cab driver]
performed is part and parcel of what defendant does, which is operate cabs in San
Francisco. A strong argument can be made that without plaintiff and others like him, the
service defendant provides could not be accomplished.”].)
The grower in Borello did not supervise the work of the harvesters, but the
Supreme Court did not find this fact significant because “the cucumber harvest involves
simple manual labor which can be performed in only one correct way. Harvest and plant-
care methods can be learned quickly. While the work requires stamina and patience, it
involves no peculiar skill beyond that expected of any employee. [Citations.] It is the
simplicity of the work, not the harvesters’ superior expertise, which makes detailed
supervision and discipline unnecessary. Diligence and quality control are achieved by
the payment system, essentially a variation of the piecework formula familiar to
agricultural employment.” (Borello, supra, 48 Cal.3d at pp. 356–357.) It is undisputed
that Tender Heart did not supervise Plaintiff in the performance of her caregiving duties.
Horvath’s declaration avers that caregiving “require[s] skills and experience which go
well beyond those possessed by the average person.” However, there is also evidence
that the duties of a caregiver—while demanding and necessitating patience, empathy, and
good humor—do not require special skills or training. Most notably, the list of
caregiving duties set forth in Tender Heart’s contracts are basic activities of daily living:
companionship, personal care and hygiene, medication reminders, meal preparation,
errands, answering the phone or door, attending events.20 Construing the evidence in the
light most favorable to Plaintiff, a factfinder could conclude a caregiver’s duties, like that
20
Although Tender Heart asserts that additional services were required depending on the
client’s need, it cites no evidence identifying such additional services or establishing that
they required special skill or training. Tender Heart also points to evidence that Plaintiff
was a certified nursing assistant and was enrolled in college courses during her time
performing caregiver work with Tender Heart. There is no evidence that a caregiver had
to be a certified nursing assistant or take college courses to perform caregiving duties.
24
of a cucumber harvester, are simply not the type requiring detailed supervision. (See
Linton, supra, 15 Cal.App.5th at p. 1222 [“That a degree of freedom is permitted to a
worker, or is inherent in the nature of the work involved, does not automatically lead to
the conclusion that a worker is an independent contractor.”].)
The parties dispute whether Tender Heart retained the right to terminate caregivers
at will. (See Ayala v. Antelope Valley Newspapers, Inc. (2014) 59 Cal. 4th 522, 531
[“Perhaps the strongest evidence of the right to control is whether the hirer can discharge
the worker without cause, because ‘[t]he power of the principal to terminate the services
of the agent gives him the means of controlling the agent’s activities.’ ”].) The Caregiver
Contract provides: “The relationship between a CAREGIVER and client may only be
terminated by either of those parties and not by [Tender Heart]. However, [Tender Heart]
may decline to make additional referrals to a particular CAREGIVER . . . .” The impact
of the restriction on Tender Heart’s ability to terminate a relationship between a caregiver
and client depends on an ambiguous term, “relationship.” Does the relationship between
a caregiver and a client form after one shift, or does it require repeated shifts? Does the
relationship, once formed, last for the duration of Tender Heart’s contract with that client,
or for some shorter period? But for this ambiguous restriction, Tender Heart’s ability to
decline to make additional referrals, apparently without cause, seems akin to the ability to
terminate at will.21 Tender Heart argues it never unilaterally ceased making referrals to
Plaintiff, but “what matters is whether a hirer has the ‘legal right to control the activities
of the alleged agent’ . . . . That a hirer chooses not to wield power does not prove it lacks
power.” (Ayala, at p. 535.)
21
Tender Heart notes that a statute declaring certain domestic work employment agencies
are not employers provides “an employment agency may decline to make additional
referrals to a particular domestic worker . . . .” (Civ. Code, § 1812.5095, subd. (b)(9); see
post, part III.) However, the statute sets forth numerous detailed requirements for an
employment agency to fall within its provisions. We decline to construe the Legislature’s
inclusion of this provision to mean that an agency’s right to decline to make additional
referrals is never indicative of an employment relationship.
25
Borello also found the harvesters “engage in no distinct trade or calling. They do
not hold themselves out in business. They perform typical farm labor for hire wherever
jobs are available. They invest nothing but personal service and hand tools. They incur
no opportunity for ‘profit’ or ‘loss;’ like employees hired on a piecework basis, they are
simply paid by the size and grade of cucumbers they pick. They rely solely on work in
the fields for their subsistence and livelihood.” (Borello, supra, 48 Cal.3d at pp. 357–
358, fns. omitted.) There is no evidence that Plaintiff held herself out in business. The
list of caregiving duties does not suggest a need for specialized tools or supplies,
although Plaintiff testified she purchased her own scrubs. She testified in her deposition
that she signed up with multiple caregiving agencies at the same time she received
referrals from Tender Heart. Horvath averred it was “not uncommon for caregivers to
work with multiple agencies, at the same time, in order to secure sufficient work to fill
their available hours . . . .” Like the cucumber harvesters, there is evidence that Plaintiff
did not have an opportunity for profit or loss, but simply performed caregiving for hire
wherever she could find work.
The Supreme Court discounted the harvesters’ contractual agreement that they are
not employees: “where compelling indicia of employment are otherwise present, we may
not lightly assume an individual waiver of the protections derived from that status. [¶]
Moreover, there is no indication that Borello offers its cucumber harvesters any real
choice of terms.” (Borello, supra, 48 Cal.3d at pp. 358–359.) Similarly, although the
Caregiver Contract signed by Plaintiff stated she was an independent contractor, not an
employee, there is evidence of other indicia of employment and Plaintiff averred in her
declaration that the Caregiver Contract was presented to her “on a take it or leave it
basis.” 22 “A party’s use of a label to describe a relationship with a worker . . . will be
ignored where the evidence of the parties’ actual conduct establishes that a different
relationship exists.” (Futrell, supra, 190 Cal.App.4th at p. 1437; see also Linton, supra,
22
Although Tender Heart argues the trial court found Plaintiff’s declaration “largely
inadmissible,” the court found this fact admissible.
26
15 Cal.App.5th at p. 1222 [“the mere fact the employment agreement characterizes the
relationship of the parties in a particular way is not determinative of the actual legal
status of the parties”].)
The Supreme Court in Borello concluded the harvesters “have no practical
opportunity to insure themselves or their families against loss of income caused by
nontortious work injuries. If Borello is not their employer, they themselves, and society
at large, thus assume the entire financial burden when such injuries occur. Without
doubt, they are a class of workers to whom the protection of the [Workers’
Compensation] Act is intended to extend.” (Borello, supra, 48 Cal.3d at pp. 357–358,
fns. omitted.) Similarly, Plaintiff entered into a contract written by Tender Heart to fulfill
caregiving contracts between Tender Heart and its clients, and there is evidence Plaintiff
was paid wages determined by Tender Heart. Moreover, at least under the standard terms
of the rate sheet incorporated as part of the Caregiver Contract, her hourly wage
decreased for shifts that, under the DWBR, would entitle her to overtime wages: she
received $13 per hour for a shift of four to seven hours, $12 per hour for a shift of eight
to ten hours, and $11 per hour for a shift of more than ten hours. There is evidence that
Plaintiff is the type of worker the DWBR was enacted to protect.
In sum, Plaintiff established a dispute of fact as to whether she was an independent
contractor or employee under both the “control over wages” test and the common law
test. The trial court erred in granting summary adjudication to Tender Heart on this
ground.23
III. Employment Agency Exception
Tender Heart argues we can affirm the trial court on an alternative ground, to wit,
that the undisputed facts establish it is a non-employer employment agency.
As noted above, the DWBR includes certain exceptions to its definition of
domestic work employer. One of these exceptions is “[a]n employment agency that
23
This conclusion renders it unnecessary for us to decide whether, as Plaintiff argues, the
trial court also erred in denying her motion for a new trial on the employee/independent
contractor issue.
27
complies with Section 1812.5095 of the Civil Code and that operates solely to procure,
offer, refer, provide, or attempt to provide work to domestic workers if the relationship
between the employment agency and the domestic workers for whom the agency
procures, offers, refers, provides, or attempts to provide domestic work is characterized
by all of the factors listed in subdivision (b) of Section 1812.5095 of the Civil Code and
Section 687.2 of the Unemployment Insurance Code.” (§ 1451, subd. (c)(2)(B).) Civil
Code section 1812.5095, in turn, provides that “[a]n employment agency is not the
employer of a domestic worker for whom it procures, offers, refers, provides, or attempts
to provide work, if all of the following factors characterize the nature of the relationship,”
including that “a signed contract or agreement between the employment agency and the
domestic worker” specifies “[h]ow the employment agency’s referral fee shall be paid.”
(Civ. Code, § 1812.5095, subd. (b).)24
24
The entire list of required factors is: “(1) There is a signed contract or agreement
between the employment agency and the domestic worker that contains, at a minimum,
provisions that specify all of the following: [¶] (A) That the employment agency shall
assist the domestic worker in securing work. [¶] (B) How the employment agency's
referral fee shall be paid. [¶] (C) That the domestic worker is free to sign an agreement
with other employment agencies and to perform domestic work for persons not referred
by the employment agency. [¶] (2) The domestic worker informs the employment agency
of any restrictions on hours, location, conditions, or type of work he or she will accept
and the domestic worker is free to select or reject any work opportunity procured,
offered, referred, or provided by the employment agency. [¶] (3) The domestic worker is
free to renegotiate with the person hiring him or her the amount proposed to be paid for
the work. [¶] (4) The domestic worker does not receive any training from the
employment agency with respect to the performance of domestic work. However, an
employment agency may provide a voluntary orientation session in which the
relationship between the employment agency and the domestic worker, including the
employment agency’s administrative and operating procedures, and the provisions of the
contract or agreement between the employment agency and the domestic worker are
explained. [¶] (5) The domestic worker performs domestic work without any direction,
control, or supervision exercised by the employment agency with respect to the manner
and means of performing the domestic work. An employment agency shall not be
deemed to be exercising direction, control, or supervision when it takes any of the
following actions: [¶] (A) Informs the domestic worker about the services to be provided
and the conditions of work specified by the person seeking to hire a domestic worker. [¶]
(B) Contacts the person who has hired the domestic worker to determine whether that
28
The trial court found Tender Heart’s contract with Plaintiff did not specify “[h]ow
the employment agency’s referral fee shall be paid” as required by Civil Code section
1812.5095, subdivision (b)(1)(B). Tender Heart points to paragraph 4 of the Caregiver
Contract, which provides: “PAYMENT OF FEES. Caregiver shall remit to [Tender
Heart] each Monday a timesheet showing hours worked and signed by Client. [Tender
Heart’s] billing service shall bill Client for services rendered by CAREGIVER. When
[Tender Heart’s] billing service receives payment from the Client the payment will be
placed into a trust account and the CAREGIVER will be paid the amount due. [Tender
Heart] is not obligated to pay the CAREGIVER if the person for whom the services were
performed fails or refuses to pay for the services. If engagement is terminated, [Tender
Heart’s] fee may not exceed CAREGIVER’s gross earnings in that engagement.” Tender
person is satisfied with the agency’s referral service. [¶] (C) Informs the domestic worker
of the time during which new referrals are available. [¶] (D) Requests the domestic
worker to inform the employment agency if the domestic worker is unable to perform the
work accepted. [¶] (6) The employment agency does not provide tools, supplies, or
equipment necessary to perform the domestic work. [¶] (7) The domestic worker is not
obligated to pay the employment agency’s referral fee, and the employment agency is not
obligated to pay the domestic worker if the person for whom the services were performed
fails or refuses to pay for the domestic work. [¶] (8) Payments for domestic services are
made directly to either the domestic worker or to the employment agency. Payments
made directly to the employment agency shall be deposited into a trust account until
payment can be made to the domestic worker. [¶] (9) The relationship between a
domestic worker and the person for whom the domestic worker performs services may
only be terminated by either of those parties and not by the employment agency that
referred the domestic worker. However, an employment agency may decline to make
additional referrals to a particular domestic worker, and the domestic worker may decline
to accept a particular referral.” (Civ. Code, § 1812.5095, subd. (b); see also Unempl. Ins.
Code, § 687.2.) The legislative history of Civil Code section 1812.5095 indicates it “was
intended to be ‘declaratory of existing law decided in Avchen v. Kid[d]oo (1988) 200
Cal. App. 3d 532.’ ” (An Independent Home, supra, 145 Cal.App.4th at p. 1434.) In
Avchen v. Kiddoo, the Court of Appeal found a nurses’ registry was not an employer for
unemployment purposes where the registry signed up nurses, informed them of work
opportunities, and put them in touch with the hospital or patient seeking a nurse, at which
point the nurse and the hospital or patient would establish the rate of pay, and the registry
would collect a commission from the nurse for successful placements. (Avchen v.
Kiddoo, at p. 534.)
29
Heart also points to an additional contract between Plaintiff and an entity called “JAH
Tender Heart,” which provides in relevant part that Plaintiff “authorize[s] JAH Tender
Heart to invoice, collect, deposit and distribute my fees for services rendered as a private
caregiver. [¶] I will supply JAH Tender Heart my client information and the appropriate
fees due on a weekly basis, JAH agrees to invoice these clients on a weekly basis, accept
payments from the client as a fiduciary and distribute my proceeds every other Monday.”
Tender Heart argues these provisions satisfy the employment agency exception by
specifying that Tender Heart’s fee is paid by “leaving [Tender Heart] with the difference
after distributing the caregiver’s agreed fixed share.” We disagree. As an initial matter,
there is no evidence that “JAH Tender Heart” is the same entity as Tender Heart, and
therefore no basis to conclude that the terms of the contract between Plaintiff and JAH
Tender Heart can be considered to determine whether the “contract or agreement between
the employment agency and the domestic worker” contains the necessary provisions.
Even so assuming, the identified provisions leave it entirely unclear how Tender Heart’s
fee is paid.25 The only provision relevant to Tender Heart’s fee addresses the maximum
fee payable to Tender Heart if a caregiver’s engagement is terminated. We agree with
Tender Heart that the statute does not require the amount or rate of the fee be specified in
the contract. Nonetheless, the requirement that the contract specify “how” the fee is paid
requires some specification, and none is provided in the provisions here.
We also note that for an employment agency to fall within the DWBR’s safe
harbor, the statute additionally requires “[t]he domestic worker is free to renegotiate with
the person hiring him or her the amount proposed to be paid for the work.” (Civ. Code,
25
A review of the standard rate sheets attached to the Client Contract and the Caregiver
Contract indicate that Tender Heart’s fee is a portion of the rate paid by the client.
However, for the employment agency exception to apply, the referral fee specification
must appear in “a signed contract or agreement between the employment agency and the
domestic worker.” (Civ. Code, § 1812.5095, subd. (b), italics added.)
30
§ 1812.5095, subd. (b)(3).) As we have concluded above, Plaintiff established a fact
dispute on this issue.26
Accordingly, we cannot affirm the trial court’s order on the alternative ground that
the undisputed facts establish Tender Heart is a non-employer employment agency
pursuant to section 1451, subdivision (c)(2)(B).
DISPOSITION
The order granting summary adjudication for Tender Heart on Plaintiff’s first
seven causes of action is reversed, and the matter is remanded for proceedings not
inconsistent with this opinion. Plaintiff shall recover her costs on appeal.
26
In the trial court, Plaintiff argued this additional reason why Tender Heart did not
comply with the employment agency exception.
31
SIMONS, Acting P.J.
We concur.
NEEDHAM, J.
BRUINIERS, J.*
(A152535)
*
Retired Associate Justice of the Court of Appeal, First Appellate District, assigned by
the Chief Justice pursuant to article VI, section 6 of the California Constitution.
32
33
Superior Court of Contra Costa County, No. MSC15-02271, Hon. Judith Craddick,
Judge.
Aiman-Smith & Marcy, Joseph Clapp for Plaintiff and Appellant.
Fritz Law Offices, William F. Fritz and Theresa R Fritz for Defendant and Respondent.
34