What is contract law?

Contract law forms the basic part of our society as it lies at the heart of our law system. It is a voluntary, private agreement made by parties that agree to exchange valuable things with one another. Most exchanges are straightforward matters that easy to perform without encountering any problem. However, some exchange may not be performed to everyone satisfaction.

In most cases contract performed should include an implied-in-law covenant of good faith that each party agree to act in good faith and deal fairly with each other. This means that no party is expected in bad faith to attempt to cheat the other party. However, in some cases, complicated transactions may lead to difficulties that the parties may not be envisioned at the onset. Some complication may take a lot of time and resources to solve.

To avoid complications, it is important to have a proper contract that the onset of the contract. A written contract can be the most appropriate form of contract to use. However, both parties should reasonably trust another’s good faith and have a good understanding of the exchange before undertaking it. The written contract should state clearly the obligations of each party and the essential terms of the exchange. A good contract should at least cover possible complications that might arise.

Various kinds of Contracts:

There are three types of contracts: written, oral and implied.

Implied contract:

Implied contract is mainly based on the decision of a court of law. They can be either written or oral, or even no agreement made. But, there is some enforceable agreement that courts can legally determine that the contract really existed.

Oral Contract:

The oral contracts are made verbally without any written document. This type of contract has many limitations as compared to written contracts as they are limited to time. For instance, the time that you can file a lawsuit that involves an oral contract is two years.

Written contracts:

Written contracts are written on a paper and include signatories of all parties involve. They are the most reliable type of contracts and are highly recommended.

Proving Implied and Oral Contracts:

The importance of implied and oral contracts especially in employment law is necessary to show that just cause is necessary before employment can be terminated. In case an employee alleges that an implied or oral contract require just before termination, the court will help to determine whether the allegation is valid or not.

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Are you an employee or an independent contractor? And really, why does it matter? You’re getting paid all the same, aren’t you?

Not necessarily. There are distinct legal differences that you need to understand between the two, and whether you’re an employee or an independent contractor can affect your rights in the workplace.

How is your status determined?

In general, if you’re self-employed, you’re probably an independent contractor. If you work for a single company, you’re probably an employee. The California Division of Labor Standards Enforcement presumes that a worker is an employee, but each state agency has its own tests to decide which category someone falls into. The basic gist is this: The more control an employer has over how an individual does their work, the more likely they are in an employer-employee relationship. State agencies also look at other factors, including whether you’re doing work that a company regularly performs itself and how permanent your working relationship is with the company.

What is the difference between the two?

As an independent contractor, you’re performing work that a business would contract with you to do, such as writing or web design. You don’t just work for one employer, but contract with multiple clients. You set your own hours and fees, work from home or your own office, and set the terms of the contract with each client. An employee works for one business and has their work terms determined by the employer, such as hours, wages, and a supervisor who reviews their work.

What are the benefits to employees?

To begin with, an employer has to pay minimum wage, overtime, and payroll taxes for employees, as well as cover them under workers’ compensation and unemployment insurance programs. That’s not the case for independent contractors. Employers provide employees with benefits such as health insurance, sick leave, and 401(k) accounts. Independent contractors get none of these. Employees also are covered by state and federal anti-discrimination laws. Finally, employees usually get an hourly wage or yearly salary. Independent contractors are typically paid by the project, and only when it’s completed.

I think I’ve been misclassified. What can I do about it?

If you think you should have been treated as an employee and not an independent contractor, you may have a wage and hour claim against the company. Contact the United Employees Law Group to see if your rights have been violated and what can be done about it.

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Still many employers, whether they know the law and do it anyway, or are not aware of the guidelines use the differentiation of employee from contractor to get around the cost of paying proper fees such as:

• payroll taxes
• minimum wage and/or overtime requirements
• paid and unpaid rest or break periods
•  reimbursing business expenses
•  workers compensation coverage
• Unemployment, disability or Social Security taxes and payments.

The number one reason employers claim you are an independent contractor? It’s cheaper for them. Sure, it also means you can write off all of your expenses, but is it really worth it? Those may in fact be THEIR expenses and why should you be paying to run their business all the while being left totally unprotected. Contractors don’t have coverage for workers compensation or unemployment benefits. That means unless you are paying for it on your own, if you are injured on the job you are on your own and many insurance companies will deny your claim saying you should be covered by workers comp for a “work related injury.”

The Division of Labor Standards Enforcement (DLSE) sets out the guidelines for who can and cannot be claimed as an independent contractor.

• You perform a service that is outside the norm for the business employing you, such as marketing specialist for a home builder.
• Your work could be defined as a specialized skill.
• You were hired to complete a well defined task only to completion and not offered an actual position with the company.
• You have no supervision, but were given a specific job to complete and are to do so on your own and how you see fit.

If you have been deemed a contractor rather than employee by your company, but these do not define your actual duties then you have likely been misclassified, you need to speak with an employment attorney right away who can determine what you may be owed in compensation.

You only have a short amount of time to file any claim having to do with you employment, call United Employees Law Group today before you file the wrong tax return.

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California labor code section 2802 states that the employer should cover all the expenses which an employee incurs due to business purpose. Thus, if an employee buys any type of tools, supplies or equipment that are needed to complete their task, then the employer will have to reimburse the expenses incurred by the employee.

Labor Code Section 2802 states that:
The employer will have to reimburse any expenses or losses which an employee has to incur while going about his official duties or on the orders of his or her employer. Even if the duties were not lawful the employer is entitled to reimburse the amount in case the employee was unaware that the instructions were unlawful.
Any awards issued by the court of the Division of Labor Standards Enforcement for reimbursement of the expenses under this section shall include the interest just like the judgments of civil actions. The interest shall be levied from the time when the employee had to bear the expenses or loss.

The term ‘necessary expenditures or losses’ also include the fees which the employee has to pay to the attorney to enforce the rights which this section grants them.
Mileage is often ignored and in case the employer asks you to make use of your personal vehicle for the company, then you should be reimbursed for those miles. Presently the IRS suggests that around 55 cents should be levied for every mile. You should bear this in mind and in case the employer is unwilling to reimburse the whole amount, then you can seek assistance from an employment attorney or a tax professional who will guide you during tax time.

You should know your rights in case an employer tries to tell you that this is a part of your job and there will be no reimbursement, or in case the employer makes you believe that this is expected of you since you have got a promotion or are now at a particular designation.
Your employer may tell you that the distance is not too much and so you should not create an issue, but remember that even these small distances traveled everyday are sure to increase your mileage considerably every month.
The expenses of uniform too are not calculated correctly. The company needs to give you any particular items which they need. In case these items include the below mentioned characteristics then the employer will have to reimburse the amount you have spent:

If the employer makes it mandatory for you to purchase the item from them directly.
In case they specify a particular brand or include the logo of the company on the uniform.
In case the item is specially designed for your profession, for instance, a bullet proof jacket.

Labor Laws are not quite simple and in case you have any queries about the employment then you should get in touch with United Employees Law Group, who will be able to assist you in knowing your rights and will also evaluate the situation without levying any charges.

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It’s that time of year again, yes the holidays too, but with the end of the year comes TAX TIME! If you own a business or work as an independent contractor you are probably well versed with your deductions and either can’t wait to add them up are dreading the big bill to Uncle Sam. On the other hand most employees just file what the w-2 says on April 15^th and wait for their tax return, BUT are there deductions you can take too. What about your boss are they using you as a deduction where they shouldn’t?

Time to double check your paystub, there are only a few LEGAL deductions an employer can make from your paycheck and it pays to pay attention.

Of course it is the HR department’s job, along with payroll to make sure your check is calculated correctly, but this is easier said than done and you may be surprised at the number of mistakes that go un-checked, mistakes that may be costing you big. The company has the right and in fact, is required by law to make some deductions from your check, such as income tax and social security contributions, but are you sure you know everything coming out of your check each pay day?

Is your company overstepping and deducting additional items from your check? This is essentially stealing; if your company is trying to deduct their cost of doing business from your paycheck you need proper representation as soon as possible. It is best to have a professional help you address this rather than going to the company yourself. The team at UELG can verify if in fact the deductions were made in error and help you collect in a manner that will help ensure you get everything you are owed.

Here are a few of the deduction you may not realize you should NOT be paying for:

These are the most common issues we see with deductions.

-Employer deduction for tips. Your tips are yours, they are gratuity left for you for a job presumably well done and CANNOT be re-appropriated by your boss. You cannot have tips deducted from you minimum wage either.

-Should your employer need or want photographs for interviews or employment , they must pay for them.

-Employees who are required to be insured or bonded must be covered under the employer and/or the policy paid by the employer.

– Uniforms must be purchased or reimbursed by the employer, other that your footwear almost all other REQUIRED apparel is the responsibility of the company to pay for.

-Business expenses are just that, you cannot be required to pay out of your pocket any expense that is a necessity to operate the business in question. This includes entertaining clients, travel expenses and meals anytime you are required to work off-site, phone bills for work use, etc. Your company writes off business expenses even if you are a sales person, if you are an employee and not a contractor, you are not responsible for business costs, that includes the cost of GETTING business.

-All drug or health checks required by the employer or by law for employment are the sole responsibility of the company.

Seen any of these on your check stub? CALL US NOW, we can help you separate the legal from the cheating and help you get what you are entitled to.

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California Workers Misclassified as Independent Contractors
While the employers are cutting off many costs by classifying their employees as Independent contractors, the IRS and the state of California are cracking down.

Employers who have deprived employees of their basic rights by misclassifying them for being independent contractors and using this in their own favor by avoiding tax payments, compensation benefits given to the workers and not paying overtime to the employees.

The IRS is taking keen interest in this situation because it is benefiting both the Government that is facing monetary shortages and the employee who is being disadvantaged of his benefits. Government is benefiting because the employers who are not paying taxes by making false classifications of employee as independent contractor are the funds that they need and the employee is being restored with his rights too such as overtime etc.
There are many federal laws and in addition to that the state laws that are trying to make sure that employee is not misclassified. There are many differences that occur in both the law sets but one thing that they agree on is the definition of employee which is the basis, and according to the law employee is a person whose actions and results of the work are controlled by some contractor, in other words way we can say that he is being supervised and directed by the contracting person.
In continuance of understanding whether the person is an independent contractor an employee a 20-factor test is developed that tells the controlling power of the contracting person. These three components are brought forward by the IRS and social security administration.

Behavior control: this determines that how much right worker of the task has control over the accomplishment of some task assigned.
Financial control: how much role is played by the worker to control the business aspect of the project?
Relationship of parties: how do both the parties consider their relation to be?
California Labor Code and California Tax Code have many laws in it to determine the classification of the worker. When it comes to the enforcement of the wages and working hours law Division of Labor Standards Enforcement (DLSE) make the worker go through “economic realities” test which shows clearly the amount of control of the worker on the task performance.
If you think you’ve been misclassified and are owed overtime or benefits we may be able to help you collect back to 2010. Call our San Francisco Employment Attorneys TODAY.

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Other states that are under similar MOU’s with the U.S. Department of Labor include Missouri, Montana, Maryland, Massachusetts, Colorado, Connecticut, Hawaii, Illinois, Montana, Utah and Washington. The hope is that by sharing information whenever possible they will be able to assist each others outreach and education efforts. Also, this should increase taxed revenue for both the state and the federal government along with all penalties acquired as a result of any legal proceeding due to misclassification.
The MOU was announced the day following the decision in the Ruiz v. Affinity Logistics Corporation, vacating the court’s ruling that the employees were correctly classified as independent contractors. In this case the court upheld a contractual provision that would apply Georgia law and in doing so gave status as an independent contractor. Georgia law is very different from California law in that California requires the burden of proof to be on the Employer, not the employee, and Georgia does not. The 9th Circuit opposed the District Court’s decision, finding that California law should apply notwithstanding the parties’ contractual selection of Georgia law, because the Georgia law conflicts with what the 9th Circuit found was a fundamental California public policy. This decision was based on the fact the work preformed was done so in California. The 9th circuit did turn the case back to the district court to reexamine the independent contractors issue.
This issue of misclassification has been a hot topic since our country’s economic issues began; all of the various government agencies are working hard to protect employees from being misclassified as well as ensure that all taxes from these employees and employers are being paid out properly. The main thing to take away from this case is that usually where the work is being preformed dictates the law that can be applied to the situation, and that it’s important to follow the guidelines for independent contractors set forth by that state.

Labor law can be complex should you have any questions regarding your employment it is recommended that you contact a San Francisco labor law attorney who can help you explore your rights and in many cases will review your situation without charge.

For questions about this or any article or information on our blog, please call us at:
(415) 230-2755 – 268 Bush St. #4202 San Francisco CA 94104

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