Hi, I have a employee that recently applied for unemployment insurance. I am a small business in california operating a home care for the me...

Question

Hi, I have a employee that recently applied for unemployment insurance. I am a small business in california operating a home care for the mentally Ill. My former employee was hired as a 1099 caregiver contractor for a 2 months temporary assignment. Would I be charged by the EDD if benefit is awarded or is my former employee even qualify for unemployment. Thanks

Answer

If EDD decides he was an employee and not a 1099 contractor, he will get benefits, and you will get assessed all the back due withholdings you should have been paying to the state and federal governments, with interest and penalties. YOU used the word employee, and that is probably correct. Independent Contractor is not a status the employer gets to 'create' for their convenience to avoid costs. He would have to meet all the criteria of IC to qualify, and I'm guessing you don't know what those are. If you are serious about hiring counsel to help you in this, feel free to contact me.

Answer

Quite possibly. The EDD will assess whether the worker was actually an employee and not an indep. contractor. The analysis is based on the amount of control you had over the worker's performance of his/her duties. There are many factors that will be considered. It is very unwise to treat workers as indep. contractors if they are not since CA is cracking down on this type of abuse of the law. It may be well worth your time and money to consult with an employment law attorney to make sure you don't set yourself up to be audited by the EDD, IRS, Labor Commissioner's office, etc.