By Mia Machado
SAN FRANCISCO/LOS ANGELES – Handy Technologies, Inc., has allegedly been unlawfully classifying its cleaning and handyman workforce as independent contractors instead of employees, putting thousands of workers in danger during COVID-19 and robbing the state of taxes, according to filings by the district attorneys in San Francisco and Los Angeles.
On Monday, San Francisco District Attorney Chesa Boudin and Los Angeles County District Attorney George Gascón announced the filing of a motion for preliminary injunction against the company, calling for it to cease the illegal misclassification of their workers.
The motion is part of the District Attorneys’ lawsuit filed in San Francisco Superior Court against Handy on March 17.
The lawsuit alleges Handy is violating California law by unlawfully misclassifying its cleaning and handyman workforce as independent contractors, and “thereby stripping them of crucial workplace protections and worker safety-net benefits.”
Handy offers and sells household services to customers, including prearranged home cleaning and handyman services. The company solicits and then pays its workers in exchange for completing those cleaning service tasks.
Handy classifies its tens of thousands of workers as independent contractors, despite their performing the central function of their business, and, under California law, these workers should be classified as Handy’s employees, according to the pleading.
The filing notes that when a company misclassifies its workers, it has serious negative consequences. Unlike employees, 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.
The district attorneys said workers are not protected by most anti-discrimination laws, have little protection from sexual harassment/assault, and do not have nearly as robust legal rights to unionize or bargain collectively. Misclassification also harms other law-abiding businesses who are forced to compete on an unlevel playing field with companies like Handy.
The state, the DAs said, also subsequently loses taxes that it uses to fund income support programs—such as unemployment insurance—while simultaneously forcing workers and their families to more often draw on the 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.
“We are seeking an immediate end to Handy’s illegal behavior of failing to provide its workers with basic workplace protections,” said San Francisco DA 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,” he added.
Los Angeles DA Gascón agreed, asserting that “this illegal and shameful practice must end. 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.”
Mia Machado is a junior at UC Davis, currently majoring in Political Science-Public Service and minoring in Luso-Brazilian studies. She is originally from Berkeley, California
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