Helpful to pay $6 million to settle IC misclassification case introduced by San Francisco and Los Angeles
May 22, 2023
Employment services platform Handy Technologies Inc. agreed to pay $6 million to resolve allegations it misclassified workers as independent contractors under California’s AB 5 law. The San Francisco and Los Angeles district attorneys announced the settlement May 18.
“This settlement is not only a victory for California workers who have been misclassified by Handy Technologies Inc., but also a warning to other companies engaged in similar illegal conduct,” said San Francisco District Attorney Brooke Jenkins. in a statement.
Prosecutors originally filed the lawsuit in 2021.
Handy dispatches employees to provide cleaning and handyman services at customers’ homes. In addition to the refund, the company agreed to a permanent injunction to avoid future misclassifications. Prosecutors said the company made significant changes to its business operations. For example, workers can now set their own hourly wages on the site and, after filling a position, contact clients directly to learn more about the requested services and negotiate terms such as hours and pay without being contractually bound to perform the work or get fined by Handy for turning down the job.
“This ruling is a long-awaited triumph for workers who have been wrongfully treated as independent contractors and deprived of their right to health care, paid vacation time and unemployment insurance,” Los Angeles County District Attorney George Gascón said in a statement.
The $6 million settlement includes $4.8 million in workers’ compensation and a $1.2 million civil penalty. There are about 25,000 workers who worked between March 2017 and May 2023.
