[Sign Up Now] to Receive Our FREE Daily SCVTV-SCVNews Digest by E-Mail

Santa Clarita CA
Today in
S.C.V. History
March 22
1875 - Construction begins on San Fernando Railroad Tunnel [story]

Commentary by Carl Kanowsky, Esq.
| Friday, Jan 17, 2014
Carl Kanowsky, Esq.

Carl Kanowsky, Esq.

Udders ‘R’ Us (“URS”) delivers milk to supermarkets in Southern California. It’s owned and controlled by a Georgia corporation. URS is run by that most dangerous of all professionals — someone who attended law school but never passed the bar.

Fred, this manager, had a tendency to approach problems as though he were still in law school. The strategy was fine until the real world reared its ugly head.

One thing practicing law teaches very quickly is that the truisms of law have little to do with reality. But Frank was undeterred.

URS needed more delivery drivers, but Fred was certain the head honchos from Atlanta would scream at hiring more employees. He envisioned the increased workers’ compensation premium and how much more the company health plan would cost as a result of bringing on more drivers.

That is to say nothing of the employer’s payroll taxes and general liability insurance with all of these new personnel.

He was already behind the budget in sales, so adding more costs would directly impact the bottom line — profit. There was only a miniscule amount as it was. More employees meant no profit at all. No profit meant Fred would need a new job.

So, Fred took his law school diploma and drafted a “drivers’ independent contractor agreement.”

From his labor-law classes, he knew California really didn’t like the independent-contractor concept, where companies designate workers as independent contractors to avoid putting people on payroll, covering workers’ compensation, and paying for benefits.

The California Supreme Court has ruled there is a fundamental California policy that seeks to protect its workers, especially in cases of whether a worker is considered an employee or an independent contractor.

Fred’s solution was to say in the contract that Georgia law applied, not California law.

In Georgia, if the contract designates the relationship between the parties to be one of principal and independent contractor, t he designation is presumed to be true. It’s just the exact opposite of California.

Armed with this new “drivers’ independent contractor agreement,” Fred went on a recruiting binge, signing on dozens of new drivers.

Everything went fine until Fred fired Bill, one of the newer drivers who had signed the contract. What Fred didn’t know was that Bill’s sister Sue (no, that really was her name) was a great class action attorney. The minute Sue heard how Fred had tried to dodge California’s public policy, she knew she had him.

Sue sued URS, alleging that delivery company violated numerous California labor laws. Fred retained a national labor-law firm, Hookum and Billum, which argued in court that the drivers and URS had agreed to apply Georgia law.

The court researched the issue and found the recent case of Ruiz v. Affinity Logistics. That case was helpful, as the fact pattern was almost identical to the one involving Bill and URS.

In Ruiz, a Georgia corporation doing business in California hired drivers who were required to sign an independent-contractor agreement that had a provision saying Georgia law governed it. The court in the URS lawsuit ruled exactly as the court in Ruiz had done.

The court decided that even though the contract said Georgia law controlled, the court would use California law.

Inquiry into which state’s laws applied didn’t stop at whether the parties had agreed on one state versus another.

The court also knew it should consider: 1) whether applying Georgia’s law “is contrary to a fundamental policy of California,” and 2) “whether California has a materially greater interest than (Georgia) in resolution of the issue.”

These two criteria were summarily dealt with. The California Supreme Court had already voiced a fundamental public policy favoring employee status over independent contractor.

California clearly had a much greater interest in how to resolve the problem. While URS is a Georgia corporation, that was Georgia’s only connection with the case.

In California’s favor, all of the drivers were California residents, the work would be done in California, URS was based in California, and the contract was negotiated and signed in California.

The decision? California law wins. The drivers were employees and not independent contractors.

Not only did URS have to pay for all of those expenses Fred was trying to avoid; it also had to pay Bill’s legal fees as well as a large sum to get out of the case.

Needless to say, Fred’s now looking for someplace else to practice law without a license.


Carl Kanowsky of Kanowsky & Associates is an attorney in the Santa Clarita Valley. He may be reached by email at cjk@kanowskylaw.com. Nothing contained herein shall be or is intended to be construed as providing legal advice.

Comment On This Story
COMMENT POLICY: We welcome comments from individuals and businesses. All comments are moderated. Comments are subject to rejection if they are vulgar, combative, or in poor taste.
REAL NAMES ONLY: All posters must use their real individual or business name. This applies equally to Twitter account holders who use a nickname.


You can be the first one to leave a comment.

Leave a Comment

Opinion Section Policy
All opinions and ideas are welcome. Factually inaccurate, libelous, defamatory, profane or hateful statements are not. Your words must be your own. All commentary is subject to editing for legibility. There is no length limit, but the shorter, the better the odds of people reading it. "Local" SCV-related topics are preferred. Send commentary to: LETTERS (at) SCVNEWS.COM. Author's full name, community name, phone number and e-mail address are required. Phone numbers and e-mail addresses are not published except at author's request. Acknowledgment of submission does not guarantee publication.
Read More From...
Friday, Mar 16, 2018
Quentin Kopp, retired judge and Bay Area politician, was once chairman of the High-Speed Rail Authority and helped sell the bullet train to voters. He’s now suing to stop it, saying, "The litigation, which is pending, will result, I am confident, in the termination of the High-Speed Rail Authority's deceiving plan."
Thursday, Mar 8, 2018
A wildfire stripped the banks of Placerita Creek of its thick, lush blanket of green – exposing thousands of shoots of the evil tamarisk.
Friday, Mar 2, 2018
In her March 2018 message, Mayor Laurene Weste outlines why Santa Clarita is a tech-savvy "smart city" and previews coming upgrades in street lighting, recycling stations and the local fiber-optic network.
Thursday, Feb 15, 2018
There was broad public support for the Desert Renewable Energy Conservation Plan, which struck a careful balance between lands available for large-scale renewable energy development and the environment. Now the federal government is rethinking it - putting the important and much-needed protections at risk.
Tuesday, Feb 13, 2018
You can prevent vision loss by finding and treating problems early. Medicare covers a glaucoma test once every 12 months for people at high risk for glaucoma
Wednesday, Feb 7, 2018
Sierra Club Angeles Chapter SCV Group Chair Sandra Cattell urges Santa Clarita Valley residents to contact their congressional representatives to push legislation to kill the Cemex mining project in Soledad Canyon.

Latest Additions to SCVNews.com
There are still a few days left to purchase tickets and be eligible to win a brand new car, a 2018 Chevy Cruze, MSRP $22,385.
March 26: Deadline to Purchase WiSH Foundation’s Win a Car Tickets
Mandatory evacuations of the 8300 block to the 9000 block of La Tuna Canyon remain in effect. The following picture, taken one mile north of the 8300 block of La Tuna Canyon, is within the area that has been evacuated. No structures were damaged due to the erosion of this hillside.
Storm Causes Hillside Erosion in La Tuna Canyon Burn Area
When Master's coach Jason Semelsberger explained that his team finished in 11th place on Tuesday in large part because of a loaded field, it wasn't a throwaway line meant to make the Mustangs feel better or to pacify their fans. It was the truth.
Mustangs Hang Tough in Competitive Field
SACRAMENTO - Senator Scott Wilk, R-Antelope Valley on Wednesday introduced a senate resolution - Senate Resolution 96 - calling on the federal government to stop, once and for all, the proposed CEMEX, inc. mega-mine near Santa Clarita and bring an end to a decades old battle between residents and the multinational conglomerate.
Wilk Resolution Calls on Feds to End Cemex Mega-Mine
Chandra Subramaniam spent his first week as the new dean of California State University, Northridge’s David Nazarian College of Business and Economics in meeting after meeting, learning about the job and the people he’ll be working with.
CSUN Names New Dean of Nazarian Business College
The North Los Angeles County Transportation Coalition is hosting a workshop with representatives from the city of Lancaster, city of Palmdale, city of Santa Clarita, and the County of Los Angeles, to showcase the improvement projects to come as a result of the transportation funding provided by Measure M.
April 2: Measure M Community Outreach Meeting
Working through a series of challenging circumstances including fires, weather and mudslides that struck the region, Lundgren Management successfully completed the Santa Barbara City College West Campus Center Project in time for classes to begin on Jan. 22.
Valencia-Based Construction Firm Completes Santa Barbara City College Project
SACRAMENTO - Senator Scott Wilk, R-Antelope Valley, introduced Senate Joint Resolution 19 (SJR 19) today calling on Congress to uphold its end of the bargain and fully fund the Individuals with Disabilities Education Act (IDEA), a program focusing on disabled students. The measure passed the Senate 37-0 and is headed to the State Assembly for consideration.
Wilk’s Individuals with Disabilities Education Act Heads to State Assembly
With the upcoming retirement of Cynthia Seamands, principal of Live Oak Elementary, there will be some administrative changes for the 2018-19 school year. Effective July 1, 2018, Stephanie Beach, principal of Castaic Elementary School, will assume the duties of principal of Live Oak Elementary School.
Live Oak Elementary Appoints New Principal
Due to updated weather conditions and a projected decrease in the amount of rainfall expected, the mandatory evacuations for Kagel Canyon, Lopez Canyon, and Little Tujunga, which were to be in effect at 6:00 p.m. Wednesday evening, were cancelled.
Mandatory, Voluntary Evacuations Remain in Effect for La Tuna Canyon Burn Areas
1875 - Construction begins on San Fernando Railroad Tunnel [story]
A flash flood watch will be in effect from 11 p.m. Wednesday through Friday, 5 a.m. due to heavy rain expected over the next couple of days, according to the Santa Clarita Valley Sheriff's Station.
Flash Flood Watch in Effect Wednesday PM to Friday AM
Radio station 88.5 FM/Los Angeles, Southern California’s leading Triple-A (adult album alternative) format station and headquartered at California State University, Northridge, is adding Andy Chanley to its afternoon drive spot.
88.5 FM/Los Angeles Adds Andy Chanley to PM Drive
The Los Angeles County Department of Animal Care and Control encourages all pet owners to make their homes pet-safe during National Poison Prevention Week, now through Saturday, March 24.
March 18-24: National Pet Poison Prevention Week
The family-friendly Gilchrist Farm in Bouquet Canyon will host its annual egg hunt and Spring Fling on Saturday, March 31.
March 31: Egg Hunt, Spring Fling at Gilchrist Farm
Weather permitting, CSUN beach volleyball is scheduled to host a pair of tri-duals this week as the Matadors host Cal State LA and No. 19 Washington on Wednesday followed by No. 15 Loyola Marymount and top-ranked Pepperdine on Thursday.
Matadors Face Trio of Ranked Teams in Beach Volleyball Tri-Duals
CSUN's softball team will host the Matador Classic this weekend with Cal Poly, Pacific, Santa Clara and Georgia Tech all visiting the Matador Diamond in Northridge.
March 23-25: CSUN Softball Team to Host Matador Classic
Fale Avin's two-out RBI single in the top of the 11th sent No. 5 Oklahoma past the CSUN softball team 2-1 Monday afternoon.
No. 5 Oklahoma Edges CSUN Softball Team 2-1 in 11 Innings
No. 4/5 Notre Dame shot 54.8 percent (40-of-73) from the field as the Fighting Irish defeated CSUN 99-81 in the first round of the NCAA Division I Women's Basketball Tournament Friday night.
No. 4/5 Notre Dame Defeats CSUN 99-81
CSUN senior Arvis Greene picked up his second consecutive Big West Player of the Week award in men's volleyball Monday after leading the then-No. 10 Matadors to a pair of upset wins over No. 3 Hawai'i last week.
CSUN’s Arvis Greene Repeats as Big West Player of the Week
Mental and physical agility, resourcefulness and a never-say-die spirit are just a few of the survival traits needed for participants to succeed in the inaugural Bear Grylls Survival Challenge April 28 and 29 at the Blue Cloud Movie Ranch.
April 28-29: First Bear Grylls Survival Challenge at Blue Cloud Movie Ranch
Kameron Quitno safely slid across the plate for the first home run of his collegiate career, sparking the TMU Mustangs to a 13-4 win over visiting Bethesda University on Tuesday at Lou Herwaldt Stadium.
Mustang Baseball Rides Home Runs to Non-Conference Win
Walmart recently expanded its test of new AI shelf-scanning technology to four stores in Southern California, including the store on Kelly Johnson Parkway in Valencia.
Walmart Launches AI Shelf-Scanning Technology at SCV Store
James Allen Hayes, 55, nicknamed by law enforcement authorities as the "Seasoned Bandit" because of his age, has formally pleaded guilty to robbing four banks in 2017, including two in the Santa Clarita Valley.
‘Seasoned Bandit’ Cops to String of Bank Heists
The Senate Education Committee gave a thumbs-up to Senate Bill 1009 (SB 1009), a measure to expand access to community college tutoring, according to California Senator Scott Wilk (R-Antelope Valley), who introduced the bill.
Wilk Community College Tutoring Bill Clears First Hurdle
Los Angeles County Fire Department firefighters doused a house fire in the 24700 block of Chestnut Street in Newhall Wednesday morning.
Firefighters Douse House Blaze in Newhall
To celebrate California’s Water Awareness month, SCV Water will hold its annual Open House on Saturday, May 12 from 9 a.m. to 2 p.m. in Central Park and at its conservation garden and patio located above the park.
May 12: SCV Water Open House; Vendors Sought
The city of Santa Clarita is urging residents and businesses, specifically those living near the recent burn areas of Sand Fire in the Sand Canyon area, to take extra precautions and stay alert as heavy rains fall this week.
City Urges Residents to Take Precautions During Storm
Santa Clarita Valley Sheriff's Station deputies out to lunch at a local fast-food restaurant recognized and arrested a 29-year-old man with two outstanding warrants Tuesday, according to officials.
SCV Deputies Arrest Fast-Food Diner on 2 Warrants, Drug Possession
March hasn’t brought a miracle to California, but it has improved the state’s water picture enough to at least delay any drought declarations.
Prospect of California Drought Persists Despite Recent Rain
1837 - Ysabel Varela born in Placerville; became second wife (and widow) of SCV landowner Ygnacio del Valle. [story]
The William S. Hart High School Wind Ensemble & Concert Band, as well as the Placerita Junior High School Advanced Band will be holding a Rich Musical Heritage Concert, Thursday, March 22 at 7:00 p.m.
March 22: Rich Musical Heritage Concert
If you think you have the right stuff, Blue Star Ranch is looking for volunteers.
Blue Star Ranch Seeking Volunteers
Comic books, comic strips, graphic novels and web comics often provide an escape from reality.
CSUN Professor Establishes Comic Studies Society
From Oklahoma! to The Sound of Music, American composer Richard Rodgers forever changed the face of Broadway musicals, giving them stories and making them oh, so hum-able.
The Soraya to Celebrate Composer Richard Rodgers
The Board of Supervisors unanimously approved a motion aimed at preventing foster youth from becoming entangled in the juvenile justice system, and ensuring supportive care for those do.
Supes Approve Motion Preventing ‘Dual Status,’ ‘Crossover’ Foster Youth