Misclassification of Exempt Employees in California FAQs | Justice for Workers

by | Dec 15, 2022 | English Blog

1. I have been misclassified by my employer. What should I do?

From the above information, it is possible to know if your employer has misclassified you as an exempt employee when you are non-exempt. The ABC test can also help you establish if you are really an independent contractor and not an employee who should receive certain benefits. If you suspect you are a victim of misclassification, you can sue your employer.

2. How do I sue my California employer for misclassification?

You can sue an employer who has misclassified you and recover unpaid wages. Any violations linked to minimum wage, meal breaks, rest breaks, and overtime can be dealt with in court. Besides recovering unpaid wages, you can also get paid for other damages.

In California, successful labor lawsuits can offer compensation for unpaid overtime, missed rest & meal breaks, minimum wage violations, interest, and legal and court fees.

It is possible to get double damages for being misclassified. Since most employers who misclassify their employees do so to many employees, such cases can result in class action lawsuits. Most misclassification cases are based on employers failing to properly classify employees, resulting in unpaid wages and overtime.

To sue an employer for misclassification in California, it is advisable to talk to a seasoned California employment attorney first. Determining the precise amount your employer owes you due to misclassification can be a complicated matter.

The criteria for misclassification of exempt employees in California also has exemptions. A seasoned California Labor attorney is the best-placed professional to handle all aspects of misclassification, from establishing wrongdoing to pursuing fair compensation. 

3. I have been fired for complaining about misclassification. What do I do?

It is an offense for an employer to fire you or take retaliatory action for complaining about any labor law violations, including misclassification. Employers who fire, demote, or take other related actions are guilty of unlawful retaliation or wrongful termination. The offense includes actions like reducing pay, firing, or threatening to fire or take other disciplinary action.
The DIR has discussed laws prohibiting wrongful termination and related offenses in California. Generally, employers who take retaliatory actions when they are guilty of misclassification only add to their list offenses. You can seek damages, back pay, reinstatement, or other applicable relief.

4. How do I report misclassification of exempt employees in California?

You can talk to a seasoned California employment law attorney if you suspect misclassification. Seasoned attorneys offer free initial consultations that provide free legal advice on how to deal with the case. Your attorney can help you report and take other necessary action.

Suppose the case results in a class action lawsuit against your employer because they have/had misclassified many other employees. In that case, most employment law attorneys handle class action lawsuits on a contingency basis, meaning you won’t pay anything until you sue your employer and get paid.

Reporting misclassification on your own: You can report misclassification online via the DIR website if you want to proceed on your own. You can anonymously report misclassification and related issues (like worker’s compensation fraud).

Employee misclassification resulting in tax fraud can be reported anonymously to the IRS via Form 3949-A. You should report misclassification to the IRS via Form SS-8 if you want them to determine your worker status.
You may need a lawyer once you establish your status. An employment law attorney in California can assist you with everything, including joining existing class action lawsuits that may be ongoing/existing against your employer. Your lawyer can also help you launch an unemployment insurance claim if you have been terminated wrongfully.

5. Is misclassification of exempt employees in California illegal? 

Yes! Employers are obligated by law (California Labor Code) to classify their employees properly and pay them accordingly. While employers can misclassify employees unintentionally, misclassification is illegal. Employers should keep proper records to avoid misclassification.

6. What penalties will my employer pay for misclassification of exempt employees in California?

Penalties range from $5,000 – $15,000 per violation or more, depending on the case. For instance, intentional or willful misclassification can attract penalties up to $25,000 for individuals misclassified as independent contractors yet they should be non-exempt. Employers are also supposed to cater for legal fees. What’s more, it is illegal for an employer to deduct anything from the compensation you are supposed to receive due to misclassification.

3. How long do employee misclassification cases take in California?

It depends! While there are statutes of limitations for many misclassification lawsuits (generally 3 years from date of last violation), the cases can take longer i.e., 4 years for breach of employment contract cases.
The time it takes to get compensated for misclassification is also determined by the presence or absence of a lawyer in the case.


8. Should I use an attorney in my misclassification case?

Absolutely! Seasoned employment law lawyers in California know how to tackle misclassification cases quickly without compromising on anything. They can do everything for you and save you the time and resources you would have wasted attempting to pursue justice on your own.

Please note that the general rules above are applicable to most but not all circumstances. You should always consult a law firm that specializes in employment law for your specific situation. 

Other blog posts on misclassification of exempt employees:

JUSTICE FOR WORKERS, P.C. is a plaintiff-side law firm that specializes in employment law and workers’ compensation (work injuries). Call us at (323) 922-2000 for a consultation. Consultation is FREE. And if we take your case, you do NOT have to pay us anything until we recover compensation for you.


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