Is your California worker an independent contractor or employee? This has become a multi-million dollar question as claims for misclassification of workers as independent contractors continue to rise at the federal and state level. Last year, the U.S. Department of Labor issued an interpretive bulletin scrutinizing the employer/independent contractor relationship, calling into question age old principles and potentially shifting more workers that we once called independent contractors over to the employee side of the equation. Both the U.S. Department of Labor and California’s Labor Commissioner are cracking down on those who misuse the “independent contractor” title to circumvent wage and hour laws. Likewise, class action lawsuits claiming misclassification continue to target companies in the “sharing economy” – a growing economic model where participants share services or products directly with each other. Misclassification mistakes in California can be costly, exposing employers to fines and penalties for failing to pay minimum wage and overtime, for missed meal and rest breaks and for failing to provide workers’ compensation coverage. Avoid becoming another misclassification casualty by learning about the differences between an independent contractor and an employee, common mistakes employers make when classifying workers and lessons learned from recent lawsuits and enforcement actions.