Willenken Partner Jason H. Wilson is presenting an oral argument before the California Supreme Court on November 3, 2020 in the matter of Gerardo Vazquez v. Jan-Pro Franchising International, Inc. et al, 923 F.3d 575, 594-596 (9th Cir. 2018), vacated and reinstated in part, 939 F.3d 1045, 1050 (9th Cir. 2019).
The California Supreme Court certified the question whether the “ABC Test,” announced in Dynamex Operations West Inc. v. Superior Court, 4 Cal.5th 903 (2018) and now used to determine whether an individual is an independent contractor versus an employee in certain contexts, applies retroactively.
In Dynamex, the Court created a new methodology for determining worker status as independent contractors versus employees—a holding that represents a sea change in employment law. The Legislature subsequently adopted the ABC Test via Assembly Bill No. 5, but its application to many industries, including franchising and the “gig economy” has been hotly contested.
The Dynamex Court, however, did not address the issue of whether its new ABC Test applies retroactively to independent contractor classifications made prior to the holding. If the Court decides that the Dynamex holding is retroactive, the ruling will have significant implications for those who have long-relied on the prior legal scheme, including franchisors and taxicab companies, as well as many small businesses, among others.
On behalf of client Jan-Pro Franchising International, Inc. (“Jan-Pro”), Willenken will argue to the California Supreme Court that it should rescind certification because application of the ABC Test to Jan-Pro was erroneous and contrary to the plain language of the ABC Test. In the alternative, Willenken will also argue that the retroactive application of Dynamex is improper, including because it would unfairly prejudice the franchising industry’s reliance on prior law.