California Supreme Court Asked to Decide Whether Dynamex is Retroactive
As we have previously written, the California Supreme Court’s decision in Dynamex Operations West, Inc. v. Superior Court dramatically changed the standard for determining whether workers in California should be classified as employees or as independent contractors for purposes of the wage orders adopted by California’s Industrial Welfare Commission. A significant question left open by that ruling was whether Dynamex would apply retroactively.
On May 2, 2019, in Vazquez v. Jan-Pro Franchising International, Inc., the Ninth Circuit concluded that Dynamex in fact applied retroactively. That decision appeared to confirm that employers were exposed to liability for failing to comply with an “ABC” test that they had no reason to believe they needed to comply with precisely because it did not previously exist under California law.
On July 22, 2019, however, the Ninth Circuit issued an order granting a petition for panel rehearing, withdrawing its decision in Vazquez, and stating that it would certify the question of whether Dynamex applies retroactively to the California Supreme Court.
Whether the California Supreme Court elects to answer the question for the Ninth Circuit is entirely up to the Court itself. Should it choose to do so, employers will have some clarity on whether the Dynamexstandard indeed applies retroactively.