Coming on the heels of the California Supreme Court’s precedent-shattering ruling on IC classification, the Seventh Circuit Court ignores an existing independent contractor agreement to find a worker likely should be classified as an employee, remanding the case back to trial.
In the case, Anthony E. Simpkins v. Dupage Housing Authority, et al., the plaintiff signed an independent contractor agreement in 2009 to work as a handyman at a vacant property managed by DHA. The nature and location of the work evolved over time, with a subsequent IC agreement signed in 2012 later being altered to an open-ended status. Simpkins, who worked primarily for DHA, sued for unpaid overtime and disability benefits after he was injured in a car accident.
The Seventh Circuit considered several factors in the case, first among them was the nature and degree of control the DHA exerted over the plaintiff. The court noted DHA assigned Simpkins specific projects and dictated the order in which he was to complete them. Despite several points of contention between the parties, the court noted “a reasonable trier of fact could find that DHA’s control over Simpkins weighs in favor of a typical employer‐employee relationship.”
The court’s method of determination diverges from prior Department of Labor precedent, attorney Hans Murphy said in a blog post. “While the court utilized the same test adopted by the DOL for wage claims like this one, it paid no attention to the DOL’s 2015 pronouncement or the DOL’s deliberate effort to downplay the importance of control.” Instead, control was the “leading factor in the determination of the parties’ relationship,” he noted.
The court’s finding should serve as caution for companies that use independent contractors. “… the reality of the relationship was what mattered more so than anything written on paper,” Murphy wrote. “In that regard, Simpkins also provides a good reminder of the fact that if a company hires someone whose regular day-job is to work primarily for that company, it is a red flag.”