Personal Injury Lawyer Blog
(Please note: the names and locations of all parties have been changed to protect the confidentiality of the proceedings.)
While it certainly may be true that outside consultants are sometimes hired on a project basis to fill a particular role that the company cannot fill in-house or to provide short-term outside consulting services, such is not the case with the employment of Smythe. As discussed below, she was working full-time for ABC and had no other clients. (See Fact No. 29) She was dedicating her full time efforts to advancing the objectives of the company. She was being held out to customers, potential customers and employees as the president of the company and was filling that role. She was involved in organizational efforts, setting and directing the objectives of the company, assisting with marketing and representing the company at conferences. This is not the traditional role of a consultant, and, in fact, it would be highly unorthodox for a company president to be an outside consultant. Rather than reflecting a true intent to retain Smythe as an independent contractor, the situation she was in with Smythe at the time of the accident was arrived at solely due to economic concerns and a desire to find a structure that would be economically best for both parties. (See Fact No. 26) Where all indicia are to the contrary, the court should, and must, ignore the “Independent Contractor” label assigned by the parties. Toyota, supra, 220 Cal.App.3d at 877.
3. ABC Supplies All Instrumentalities
At the time of the accident giving rise to this action, ABC was being supplied with all instrumentalities necessary to carry on her work for the benefit of ABC, including an office, an email account, a cell phone, voicemail, a computer and a company credit card. (See Fact No. 27) In addition, when she attended the conference in northern California, her expenses were paid by ABC, which provided him with a rental car, corporate housing and a local office in which to work. (See Fact No. 28)
Again, contrary to what would be expected with an independent consultant, ABC provided Smythe everything it would provide any other traditional employee to carry on the work of the company.
4. Length of Employment and Method of Payment
Although ABC had just returned to ABC in April of 2006, the duration of her employment was unlimited. She had previously worked for ABC for two-and-a-half-years (See Fact No. 1) When she returned in April of 2006, it was intended to be long term employment. (See Fact No.23, 25) Although she originally intended to have other clients, she was never able to take on such additional clients because all of her efforts were directed toward the work of ABC. By May of 2006, Chan wanted her in a full-time role so she didn’t pursue other clients. (See Fact No. 29)
Smythe was paid at a rate of $125.00 per hour, with a monthly cap of $15,000.00. (See Fact No. 30) The fact that Smythe was engaged full-time and without the opportunity to pursue other clients, and that she was paid hourly rather than by the project, by the outcome, by commission or by percentage of sales are all factors that characterize a direct employment relationship, and not one of independent contractor. (See Part 9 of 14.)
For more information you are welcome to contact Sacramento personal injury lawyer, Moseley Collins.