A federal district court in California found that technicians working under a contract with AT&T to install security systems for the telecom company can pursue wage, hour, and labor law violations under state and federal law even though their contracts explicitly classified them as independent contractors, as reported on the Employment Law Daily.

According to the complaint, the plaintiffs were employed by Carter Brothers, a company with which AT&T contracted to hire, train, and supply the technicians for installation jobs.  The lawsuit alleges that Carter Brothers entered into “independent contractor” agreements with the individual technicians to avoid federal and state wage-hour laws and to evade tax liability.  The technicians also claim that they were fraudulently induced to sign the contracts with a promise that they would be made AT&T “W-2” employees after a short trial work period.

The plaintiffs are suing both companies to recover compensation.

AT&T asked the court to dismiss the action claiming that it was not an employer. The court denied the request, determining that there is enough evidence to proceed given that AT&T had the right to:

  • Control the technicians’ appearance (they wore uniforms with the AT&T logo)
  • Control the technicians’ working conditions
  • Require the technicians to participate in a two-week training program
  • Require on-going training
  • Dispatch the technicians to their work sites
  • Supervise and oversee the technicians work
  • Forbid the technicians from engaging in outside work with competitors (during and after the terms of their agreement)
  • Provide the technicians with vehicles bearing the AT &T logo

AT&T also tried to persuade the court with evidence that the technicians obtained their own licenses and purchased their own tools. Again, the court found that these two factors were not enough to negate an employer-employee situation.

Employees need to be aware that certain actions can create an employment situation even if employers try to characterize it differently to avoid paying lawful wages and overtime. If you feel you’ve been denied compensation to which you are entitled, the lawyers in Sommers Schwartz’s Employment Litigation Group are here to answer your questions.