Scars of the Mind Picture Company, LLC is a motion picture production company specializing in low-budget independent films. In the spring of 2018, it was engaged in filming a theatrical motion picture titled “Acts of Desperation.” Filming took place at various locations within the “30-mile” zone centered in Hollywood, including Elysian Park in Los Angeles.
Not until Scars of the Mind applied for a permit to film in Elysian Park did it learn that the conditions of the permit for each day’s shooting included the presence of at least two police officers for traffic control. To fill this function they used active or retired Los Angeles Police Department officers who worked as traffic control officers at an on-location film shoot that occurred over three days in Elysian Park, Los Angeles. They learned of the job, where to go and when to start from Eddie Esparza, principal of Pacific Production Services (PPS), not from anyone at Scars of the Mind.
Each of the LAPD officers completed W-9 forms as individuals/sole proprietors, and each demanded and received an additional 15 percent of their daily compensation as reimbursement for anticipated self-employment taxes along with the $75 kit box rental fee. They were paid directly by Scars of the Mind. Each check provided for their services was returned unpaid because of insufficient funds.
Once she was informed of the bounced checks, Leslie Bates, an individual respondent and a producer of the film, wrote checks from her personal account to each officer, in an amount equal to the compensation owed as well as bank charges incurred by each officer. All three testified that they felt they had received what was owed from Scars of the Mind.
Nonetheless, the three officers retained counsel and filed suit to recover various remedies afforded to employees under the Labor Code, as well as attorney’s fees. Their claims included a demand for 30 days’ wages for each of the three officers, pursuant to Labor Code section 203; a similar demand for paying wages with a bad check, pursuant to Labor Code section 203.1; failure to pay minimum wage and overtime under Labor Code sections 510 and 1194; failure to provide pay stubs in violation of Labor Code section 226, subdivision (a); failure to provide employment records in violation of Labor Code sections 226, subdivision (b), and 1198.5; for restitution under Business and Professions Code section 17200, and for civil penalties under the Private Attorneys General Act (Lab. Code, § 2698 et seq.).
Following a two-day bench trial, the court entered judgment in favor of the film company, finding that the officers were independent contractors rather than employees, and that the statutes under which they sought relief were inapplicable to independent contractors. The Court of Appeal affirmed the trial court in the unpublished case of Estrada v Scars of the Mind Picture Company, LLC. B314136 (August 2022).
At trial, both sides agreed that the ABC test adopted in Dynamex and subsequently codified at Labor Code section 2775, subdivision (b)(1) is the applicable legal test, and this is the legal standard that the trial court applied.
However the Court of Appeal noted that “the claim under Labor Code section 203.1 for paying wages with a bad check was governed by the so-called common-law test under Borrello.” (S.G. Borello & Sons, Inc. v. Dept. of Industrial Relations (1989) 48 Cal.3d 341) And the opinion went on to say “we deem any such objection to be waived by appellants, and we will review the trial court’s findings of fact using the ABC test.”
The question of what legal standard or test applies in determining whether a worker is an employee or, instead, an independent contractor is a question of law, and in this case the “ABC” test outlined in Dynamex Operations West, Inc. v. Superior Court (2018) 4 Cal.5th 903 is the controlling standard. The new Labor Code provisions codifying the ABC test expressly apply only “to work performed on or after January 1, 2020” (Lab. Code, § 2785, subd. (c)), making those statutes inapplicable to this case.
The Court went on to review the evidence in great detail for each of the three criteria in the “ABC” test and concluded that the evidence was sufficient to support the trial court’s finding in favor of Scars of the Mind.