28 Cal. App. 5th 558
Cal. Ct. App. 5th2018Background
- Plaintiff Jesus C. Garcia drove taxis in Calexico under leases with Border Transportation Group, LLC (BTG) from ~2009–2014; leases labeled him an independent contractor and required leasing a city vehicle permit.
- BTG owned 30 of 45 city vehicle permits; local ordinance limited driver permits to a specified taxi company and required a new permit if a driver switched companies.
- Garcia paid weekly permit/lease fees and optional dispatch fees, kept fares, and sometimes used his own car; he sued (2015) alleging eight causes of action including wage‑order claims (unpaid wages, minimum wage, meal/rest breaks, wage statements, UCL) and non‑wage‑order claims (overtime, wrongful termination, waiting time penalties).
- Defendants moved for summary judgment; the trial court granted it, finding Garcia an independent contractor under the Borello multifactor/control test.
- After briefing, the California Supreme Court decided Dynamex, adopting the ABC test for wage‑order claims; the Court of Appeal invited supplemental briefing and then reevaluated whether summary adjudication was proper under Dynamex.
- The appellate court reversed as to wage‑order claims (finding triable issue on Dynamex part C) and affirmed as to non‑wage‑order claims (Garcia forfeited review under Borello), remanding for partial denial/grant of summary adjudication.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Dynamex ABC test applies to Garcia's wage‑order claims | Garcia: wage‑order claims governed by Dynamex; he is an employee under ABC | Defendants: either Borello applies or Dynamex still shows independent contractor | Dynamex applies to wage‑order claims; ABC test controls them |
| Whether defendants met burden under ABC part C (worker customarily engaged in an independently established business) | Garcia: did not show he was independently established; limited evidence he served other clients or marketed an independent business | Defendants: point to ability to work for others, keep fares, lease arrangements, and out‑of‑company opportunities (relying on Sebago framing) | Defendants failed to show part C; triable issue exists — summary adjudication improper for wage‑order claims |
| Whether Borello or Dynamex governs non‑wage‑order claims (overtime, wrongful termination, waiting time) | Garcia: Dynamex should not necessarily apply; these claims governed by broader common‑law inquiry | Defendants: Borello applies and shows independent contractor, so summary judgment proper | Borello governs non‑wage‑order claims; Garcia forfeited appellate review, so summary adjudication for defendants on those claims affirmed |
| Effect of municipal permit scheme on independent‑contractor analysis | Garcia: municipal rules (permits tied to company) support lack of independent business | Defendants: argue drivers could lease/operate independently (citing other jurisdictions) | Court: local permit regime undermines Sebago‑style «capable of» argument; supports finding part C not shown by defendants |
Key Cases Cited
- Dynamex Operations W. v. Superior Ct., 4 Cal.5th 903 (Cal. 2018) (adopts ABC test for wage‑order employment determinations)
- S.G. Borello & Sons, Inc. v. Dept. of Indus. Relations, 48 Cal.3d 341 (Cal. 1989) (multifactor/control test for employee status)
- Martinez v. Combs, 49 Cal.4th 35 (Cal. 2010) (wage orders define ‘‘employ’’ to include ‘‘suffer or permit to work’’)
- Sebago v. Boston Cab Dispatch, Inc., 471 Mass. 321 (Mass. 2015) (Massachusetts decisions applying ABC part C as a ‘‘capable of’’ inquiry; relied on by defendants but distinguished)
- Yellow Cab Coop. v. Workers’ Comp. Appeals Bd., 226 Cal.App.3d 1288 (Cal. Ct. App. 1991) (applied Borello to conclude taxi lessee was an employee)