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socrateaser
socrateaser, Lawyer
Category: California Employment Law
Satisfied Customers: 33564
Experience:  Retired (mostly)
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i work at a very prestigious corporation - I was hired as on-call

Customer Question

i work at a very prestigious corporation - I was hired as on-call contract employee - i have been there for over (let's play it safe) 9 years - they are my only means of support, I haven't worked for anyone else - after 2 years of directly being paid by them, they advised that they were going to outsource my payroll and i asked if that would change any of my status with my company - I waws advised that it didn't, that it was my payroll that was being moved over - during this transition, they cut, my on-call and shift differential pay - still i didn't complain because the goal was to obtain permanent employment with this prestigious corporation - they told me how much they were going to pay me, where to report to work, at what time to be there, they gave me a raise, a regular company ID and employee number, a laptop, a cell phone, desk area, put me on the insurance to drive their vehicles, gave me keys and codes to the buildings and vehicles and i use all of their equipment - as I am not in business for myself nor do I work on a 1099 - I had been working steadily up until this year -- the work has been very sporatic and my hours have been cut,,,and lately more than ever in my tenure at this corporation - since my time there, I have applied for 2 or 3 positions the same as what I do for them and have been by-passed because they say that they went with someone who had more experience --- however, upon contacting HR and after several attems throughout my tenure there - I came to kind of find out that they don't consider me an employee of this corporation (which keeps me from any vacation pay, sick pay, bonus pay, 401K matching or pension benefits) which is odd because I applied for the positions as an employee through their website with an employee number and access code - I came to find out that they are saying I can go ahead and apply for unemployment through the company they outsourced my payroll to because according to their records, which they say seems odd, I'm an out sourced employee - but I have never applied with this supposedly outsourcing agency - it's out of state and I work in california - county of Los Angeles to be exact - I looked at some information on the labor board/unemployment website and according to one questionaire (intended for employers to be sure of how they are treating their employees vs what they are classifying them as) and according to that they have been treating me as employee - but I have not received any of the benefits and more important, I never gave any authorization for my information/employment other than any payroll data to be transferred to any other 3rd party entity ---- the important part now is that I want to work and although I have never filed for unemployment before during any of the slow periods (because they were short and few in between) - this time I haven't worked for longer than expected and I can't survive on that - but more so I don't know what to do about it - I had never before filed for unemployment because as I said before, it wasn't usually for a meaningful amount of time but more so because I didn't want to rock the boat with the corporation since I wanted to actually be full-time permanent - not permanent on-call contract - but now it seems as though since i have nothing to loose because according to what I am kind of being told, i don'treally count for them - then I guess I just might - but in the end, what i want is my job, to be able to survive on ther pay I was getting and assist my family with bills - with what has been done to me I don't know if I have grounds to pursue this - I just want my job, or a job with this corporation - my wife prefers they bridge my time and pay me accordingly, with back pay for everything i haven't received plus 401k at a matching rate and pension (which i have enough years in in order to get) - is any of this even possible? Do I have any case?
Submitted: 1 year ago.
Category: California Employment Law
Expert:  socrateaser replied 1 year ago.
It is not illegal to be paid by an outsourced payroll company. It is illegal to do it in order to avoid paying ERISA benefits (401(k) and health care, etc.). This is not an issue for the California Labor Commissioner. Rather it is an issue for the U.S. Department of Labor -- or for a private employment rights attorney. If there are many employees in similar circumstances as you, then there actually may be a very large lawsuit involving all of them.

It's a very complicated employment law case, with a lot of twists and turns. There is an article at this link which discusses the legal issues involved, and you may want to review it to get an idea of how complicated your situation actually is.

Frankly, I think you may want to talk to a local employment rights lawyer to see if the case can be expanded to other outsourced employees. For a competent referral, see this link.

I'd like to say that your case is a "slam dunk," but I suspect that your "employer" has done everything possible to try to avoid providing you regular employee benefits, and that it could be a real uphill battle. You could also contact the U.S. Department of Labor Employee Benefits Security Administration and request an investigation.

Concerning filing for unemployment, your weekly wages must be cut by at least 20% before you have a good shot at claiming you have been unemployed. If that's your situation, then you can file an unemployment claim.

Hope this helps.

NOTICE: My goal here is to entertain while educating the public about the law. I hope my answer is useful and informative to you. During our conversation, the website may ask you to rate my answer. If you rate my answer lower than the middle rating, then the website retains your entire payment, and I receive nothing. It is entirely your choice as to how you rate my answer. However, because your payment to me is in the nature of a donation/gift, rather than as compensation for any services rendered, you are entitled to know how your rating affects the final distribution of your donation.

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Customer: replied 1 year ago.
can a corporation outsource me without letting me know? And if they have been treating me like an employee even if I am a contracted corporation employee aren't i actually a corporation employee?
Expert:  socrateaser replied 1 year ago.
There is no bright line rule. The question could devolve in to one of whether the employer has defrauded you. This would be a novel lawsuit, but it's a possible recourse.

The usual technique of an employer is to treat employees as independent contractors and pay them with a 1099Misc form rather than with a W-2. Your case is quite different. You are an employee, but apparently not a direct employee. Therefore there is no issue of a failure to pay unemployment, workers compensionat, FICA or Medicare taxes. The issue is whether or not the alleged diversion is intended to deprive you of the benefits ordinarily accorded to regular employees, and whether or not it is illegal to do so. This impacts ERISA (Employee Retirement Income Security Act), by using a sham employer. It's a very complicated situation, with little case law.

If you can successfully explain the situation to the U.S. Department of Labor, they may be interested, because there are Internal Revenue tax laws that prohibit employers from treating employees differently for retirement purposes, where one employer controls all of the subsidiary employers ("controlled group").

There are a lot of difficult legal questions here. You have good reason to be annoyed, but it is not a simple legal case and it will require a lawyer's or the government's careful attention, if it's to go anywhere favorable for you.

Hope this helps.

NOTICE: My goal here is to entertain while educating the public about the law. I hope my answer is useful and informative to you. During our conversation, the website may ask you to rate my answer. If you rate my answer lower than the middle rating, then the website retains your entire payment, and I receive nothing. It is entirely your choice as to how you rate my answer. However, because your payment to me is in the nature of a donation/gift, rather than as compensation for any services rendered, you are entitled to know how your rating affects the final distribution of your donation.

If you need to contact me again, please put my user id at the beginning of your question ("To Socrateaser"), and the system will send me an alert. Please Click the following link for IMPORTANT LEGAL INFORMATION. Thanks and best wishes!

Customer: replied 1 year ago.

Sorry I'm his wife and have lots of questions :-( the word we were looking for earlier was "vested" by this time with his pension he would be vested ---- do you know if any of the prestigious medical entities having these types of issues?


 


I don't understand how a corportaion can just arbitrarily hire you and then discard you without advising - that just doesn't make sense - and after my husband has been over there time after time to seek HR's assistance he's been given the run-a-round. I believe someone was checking into his records and they advised that something wasn't right - that his file didnt make sense and that he shows in the global address book as an employee not a contractor - he has e-mail address and both a work phone and cell phone issued to him as well a laptop and like stated before he is told what to do - he doen't get a 1099 - he deosn't own his own business - and he submits his time cards to his department manager. Earlier in his employment he was always part of any meeting events and lately they started excluding him - people have advised him that his HR file isnt right - but whenever he asks questions the answers he gets aren't straight - we got wind that someone in the corportation advised the people looking in this situation to leave it alone - We just don't know what step to take next :-( maybe a lawyer who will only take a percentage of any winnings vs charging a fee (we pretty much out of money since he hasn't been working) :-(


 


 

Expert:  socrateaser replied 1 year ago.
The facts that you are describing (treating him as if he is a direct employee) could be proof that the employer is attempting to discriminate against your husband in depriving him of ERISA benefits (see 29 U.S.C. 1060(c)-(e)). But, it's a complex calculation and you need to know about the ownership relationships of the various businesses -- which is something that you can only find out after starting a lawsuit -- or if you're the government and you can demand an audit of the various employer benefit plans.

As I've already said, he can complain to the U.S. Department of Labor Employee Benefits Security Administration, or he can try to find an employment rights attoreny who is willing to sue (and it would be better if there were other employees in similar circumstances, because that would provide more incentive for an attorney to take the case).

Hope this helps.

NOTICE: My goal here is to entertain while educating the public about the law. I hope my answer is useful and informative to you. During our conversation, the website may ask you to rate my answer. If you rate my answer lower than the middle rating, then the website retains your entire payment, and I receive nothing. It is entirely your choice as to how you rate my answer. However, because your payment to me is in the nature of a donation/gift, rather than as compensation for any services rendered, you are entitled to know how your rating affects the final distribution of your donation. If you need to contact me again, please put my user id at the beginning of your question ("To Socrateaser"), and the system will send me an alert. Please Click the following link for IMPORTANT LEGAL INFORMATION. Thanks and best wishes!

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