Rachel Marshall, (415) 416-4468 / Rachel.Marshall@sfgov.org
SAN FRANCISCO –Today, San Francisco District Attorney Chesa Boudin and Los Angeles County District Attorney George Gascón announced the filing of a motion for preliminary injunction seeking to immediately stop Handy Technologies, Inc. from continuing to break the law by misclassifying its workers as independent contractors instead of employees. The motion is part of the District Attorneys’ lawsuit filed in San Francisco Superior Court against Handy on March 17, 2021, which alleges Handy is violating California law by unlawfully classifying its cleaning and handyman workforce as independent contractors, thereby stripping them of crucial workplace protections and worker safety-net benefits.
“We are seeking an immediate end to Handy’s illegal behavior of failing to provide its workers with basic workplace protections,” said San Francisco District Attorney Chesa Boudin. “All three branches of California’s government have already made clear that these workers are employees under California law and entitled to these important safeguards. The failure to provide these vulnerable workers basic protections puts them at risk, particularly during the COVID pandemic.”
“This illegal and shameful practice must end,” Los Angeles District Attorney George Gascón said. “Employees deserve healthcare and workplace safety protections, especially during these precarious pandemic times. Additionally, competing businesses who follow the law deserve an even playing field.”
Handy is a company that that offers and sells household services, including prearranged home cleaning and handyman services. Handy solicits and then pays workers to perform those cleanings and handyman tasks for customers. Handy classifies its workers, who perform the central function of Handy’s business, as independent contractors when, under the law, they are Handy’s employees. Handy has tens of thousands of workers providing labor and services in California.
Misclassification of Employees Hurts Vulnerable Workers
Misclassifying workers has serious negative consequences: independent contractors have no statutory right to minimum wage, overtime, paid sick leave, reimbursement for business expenses, compensation for injuries sustained on the job, or access to disability or unemployment insurance. Additionally, misclassified workers are not protected by most anti-discrimination laws, do not have as much protection from sexual harassment/assault and do not have nearly as robust legal rights to unionize and to bargain collectively.
Misclassification also does tremendous harm to law-abiding businesses forced to compete on an unlevel playing field, and it harms the public welfare by robbing the state of taxes it uses to fund income support programs (such as unemployment insurance) while at the very same time forcing workers (and their families) to more often draw upon that social safety net. According to California’s Division of Labor Standards Enforcement, misclassification in California results in an approximate loss to the state of $7 billion per year in payroll tax revenue.