Gonzales v. San Gabriel Transit, Inc.

Gonzales v. San Gabriel Transit, Inc.

Opinion

 [**687]  WILLHITE, Acting P. J.—Appellant Francisco Gonzales formerly worked as a driver for respondent San Gabriel Transit, Inc. (SGT), a company that coordinates with public and private entities to arrange transportation services for passengers. In February 2014, Gonzales filed this putative class action seeking to represent over 550 drivers engaged by SGT as independent contractors from February 2010 to the present. Among other things, Gonzales alleged that by misclassifying drivers as independent contractors, SGT violated various provisions of the Labor Code¹ and the Industrial Welfare Commission's (IWC) wage orders,² particularly Wage Order No. 9-2001 (Wage Order No. 9) (codified at Cal. Code Regs., tit. 8, § 11090), which governs the transportation [***2]  industry, and engaged in unlawful business practices under Business and Professions Code section 17200 (section 17200). The trial court did not evaluate individual causes of action. Rather, analyzing [*1140]  the action as a whole, premised on terms contained in several lease agreements in effect during the class period, the court found that Gonzales failed to demonstrate the requisite community of interest or typicality among SGT drivers under the then-prevailing legal test, and denied the motion for class certification.

While this appeal was pending, the California Supreme Court decided Dynamex Operations West, Inc. v. Superior Court (2018) 4 Cal.5th 903 [232 Cal. Rptr. 3d 1, 416 P.3d 1] (Dynamex), in which it adopted the “ABC test” used in other jurisdictions to streamline and provide consistency in analyzing the distinction between  [**688]  employees and independent contractors for purposes of wage order claims.³ We conclude that: (1) the ABC test adopted in Dynamex is retroactively applicable to pending litigation on wage and hour claims; (2) the ABC test applies with equal force to Labor Code claims that seek to enforce the fundamental protections afforded by wage order provisions; and (3) statutory claims alleging misclassification not directly premised on wage order protections, and which do not fall within the generic category of “wage [***3]  and hour laws,” are appropriately analyzed under what has commonly been known as the “Borello” test (referring to S.G. Borello and Sons, Inc. v. Department of Industrial Relations (1989) 48 Cal.3d 341 [256 Cal. Rptr. 543, 769 P.2d 399] (Borello)).⁴

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