Los Angeles Employee Misclassification Lawyer

Reviewed by Eliot J. Rushovich, Managing Partner, Rise Law Firm, PC. Last updated October 2026.

California law presumes that a person who is paid to perform work is an employee, not an independent contractor. A company that labels a worker an “independent contractor,” issues a 1099 instead of a W-2, or requires the worker to form an LLC does not change the worker’s legal status if the company in fact directs the work and the work is part of its regular business. Misclassified workers lose overtime, expense reimbursement, paid sick leave, unemployment insurance and workers’ compensation coverage, and many lose the protections that apply when an employee is fired, harassed or retaliated against.

Rise Law Firm represents workers throughout Los Angeles and California who were misclassified and then let go, including workers who were cut loose after asking to be treated as employees or after complaining about pay, safety or harassment. We represent employees only.

Employee or independent contractor: the ABC test

For most purposes under the Labor Code, the Unemployment Insurance Code and the wage orders, California uses the “ABC test” (Lab. Code § 2775, codifying Dynamex Operations West, Inc. v. Superior Court (2018) 4 Cal.5th 903). A worker is an employee unless the hiring company proves all three of the following:

• A. The worker is free from the company’s control and direction in performing the work, both under the contract and in fact.
• B. The work is outside the usual course of the company’s business.
• C. The worker is customarily engaged in an independently established trade, occupation or business of the same nature as the work performed.

The company bears the burden on each part, and failing any one of them makes the worker an employee. A salesperson for a sales company, a technician for a repair or installation company, or an office worker who works set hours under a manager’s direction will rarely meet the test.

The law has many exemptions for particular occupations and business-to-business arrangements, such as certain licensed professionals, real estate agents and some creative and freelance work (Lab. Code §§ 2776–2784). Where an exemption applies, the older multi-factor test from S.G. Borello & Sons, Inc. v. Department of Industrial Relations (1989) 48 Cal.3d 341 decides the question, focusing mainly on whether the company has the right to control how the work is done. App-based rideshare and delivery drivers are governed by Proposition 22 (Bus. & Prof. Code § 7448 et seq.), which has its own rules.

The title on a contract, a 1099, or the worker’s agreement to be called a contractor does not decide the issue. What matters is how the work is actually performed.

What misclassified workers lose, and being let go for questioning it

A worker who should have been treated as an employee may be entitled to what the company did not provide, including:

• Wages. Minimum wage, overtime, and pay for missed meal and rest breaks.
• Expenses. Reimbursement for necessary business expenses, such as mileage, a personal phone, tools and equipment (Lab. Code § 2802).
• Benefits and insurance. Paid sick leave, the employer’s share of payroll taxes, and coverage under unemployment insurance, state disability insurance and workers’ compensation.
• Penalties. The Labor Code imposes civil penalties of $5,000 to $25,000 per violation for willful misclassification (Lab. Code § 226.8), which employees can pursue through the Private Attorneys General Act (PAGA), along with other penalties for wage statement and final pay violations.

Misclassification also affects what happens at the end of the relationship. Companies often “end the contract” of a worker who asks to be put on payroll, asks about overtime or expenses, files a claim with the Labor Commissioner, or complains about harassment or safety. If the worker was in fact an employee, that termination can be unlawful retaliation (Lab. Code §§ 98.6, 1102.5) and wrongful termination in violation of public policy. Misclassified employees are also protected by the Fair Employment and Housing Act (FEHA) against discrimination and retaliation, and FEHA’s harassment protections extend even to true independent contractors (Gov. Code § 12940(j)(1)).

These are the situations we see most often:

• A long-term “contractor” who works set hours under a manager, asks to be made an employee, and is told the company no longer needs their services.
• A worker who files a wage claim or questions a 1099 and is cut off from assignments.
• A misclassified worker who reports harassment or discrimination and is let go, with the company arguing that employment laws do not apply.

These are common examples, not a complete list. Read more on our retaliation and wrongful termination pages.

Deadlines (statutes of limitations) and compensation

The main deadlines are below. They can be shorter or longer depending on the facts, so it is best not to wait.

Depending on the facts, a misclassified worker who was let go may recover unpaid wages and expenses, interest, waiting time penalties of up to 30 days’ pay (Lab. Code § 203), lost wages from the termination, and, in a wrongful termination or FEHA case, emotional distress damages and, where the employer acted with malice, oppression or fraud, punitive damages (public entities are not liable for punitive damages under Gov. Code § 818). Prevailing employees can recover attorney’s fees and costs on many of these claims.

Frequently asked questions

I signed an independent contractor agreement. Does that mean I am a contractor?

Not necessarily. The agreement is not controlling. Under the ABC test, the company must prove that you were free from its control, that your work was outside its usual business, and that you ran an independent business of your own. How the work was actually performed matters more than what the contract says.

I was paid on a 1099 and my contract was ended after I asked to be made an employee. Is that legal?

It may not be. If you were in fact an employee, ending the relationship because you asked about your status, your pay or your expenses can be unlawful retaliation and wrongful termination. Keep track of the dates of your requests and of each event that followed, and save any emails, texts and invoices you already have.

The company had me form an LLC. Does that change anything?

Not necessarily. Requiring a worker to form a business entity does not by itself make the worker a contractor. Courts look at the substance of the relationship, not its label.

Can I still file a discrimination or harassment claim if I was called a contractor?

Yes, in many cases. If you were in fact an employee, FEHA’s discrimination and retaliation protections apply. FEHA’s harassment protections also cover people providing services under a contract (Gov. Code § 12940(j)(1)).

I drive for a rideshare or delivery app. Does the ABC test apply to me?

Generally not. App-based drivers are covered by Proposition 22, which treats them as contractors if the company meets certain conditions and provides minimum earnings guarantees and other benefits. Drivers for traditional delivery and logistics companies are not covered by Proposition 22.

If you live or work in Long Beach, see our Long Beach misclassification page. For an overview of the cases we handle, see our Los Angeles employment lawyer page.

Talk to a Los Angeles misclassification lawyer

Rise Law Firm represents employees throughout California in wrongful termination, retaliation, discrimination and harassment cases, from chief executives to minimum-wage workers. We have secured millions of dollars for our clients, including recoveries against major companies, government entities, and celebrities, and we are particularly well known for handling high-profile cases. We work on a contingency basis, which means there are no fees or costs unless we recover compensation for you.

If you were labeled an independent contractor and were let go after questioning your status, asking for employee pay or benefits, or reporting a problem, contact us to request a free, confidential consultation, or call (310) 728-6588. You can learn more on our wrongful termination and retaliation pages.

This page provides general information about California law and is not legal advice. Reading it does not create an attorney-client relationship.