California Announces Multi-Million Judgment Against Employers in Worker Misclassification Case
On October 2, 2025, California Attorney General Rob Bonta announced a $10 million judgment against employers that improperly classified in-home care workers as independent contractors. Care Specialist HCS Inc. (doing business as TLC Home Care Services) and its former owners and operators were cited for knowingly and recklessly misclassifying workers. Here, our California employment litigation attorney for employers highlights some lessons to take from the enforcement action.
Employer Held Liable for Worker Misclassification in Southern California
California Attorney General Rob Bonta confirmed a $10 million judgment and permanent injunction against Care Specialist HCS Inc. and its current owners for misclassifying in-home care workers as independent contractors. The Los Angeles County Superior Court held that the company violated state labor laws and state unfair competition laws. In doing so, it reportedly deprived workers of their rightfully entitled wages, benefits, and protections. The ruling includes restitution, civil penalties, and a ban on future misclassification. In this press release, Attorney General Bonta emphasized that his office will continue to crack down on worker misclassification by employers.
What Employers in California Need to Know About Worker Classification
Worker classification remains one of the most carefully regulated areas of California labor law. The determination of whether a worker is an employee or an independent contractor governs rights and obligations under state and federal statutes, including wage and hour laws, unemployment insurance, and workers’ compensation. Misclassification of an employee as an independent contractor exposes employers to serious liability in California. The ABC Test (codified under Assembly Bill 5 (AB 5) and Labor Code § 2775) serves as the primary legal standard in California. A worker is presumed to be an employee unless the hiring entity satisfies all three prongs:
- The worker is free from control and direction of the hiring entity in performing the work;
- The worker performed is outside the usual course of the hiring entity’s business; and
- The worker is customarily engaged in an independently established trade, occupation, or business.
Failure to meet any element results in employee status. In other words, a worker generally cannot be properly classified as an independent contractor in California if they do not meet even one of those three conditions. Employers must maintain accurate records, verify classification status, and update contracts and pay structures accordingly. Companies and organizations should be aware of the fact that the California Department of Industrial Relations (DIR) and Attorney General’s Office have intensified enforcement efforts in recent years. If you have questions about worker classification, an experienced California employment attorney or employers can help.
Call Our California Employment Litigation Attorney for a Confidential Consultation
At Sloat Law Group, APC, our California employment lawyer has the professional experience you can trust in complex cases. If you have any questions about independent contractor classification, please do not hesitate to contact us today for a fully confidential consultation. With an office in Riverside County, we provide employment litigation representation statewide in California.
Source:
oag.ca.gov/news/press-releases/attorney-general-bonta-continues-protect-workers%E2%80%99-rights-secures-10-million
