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RECENT CALIFORNIA SUPREME COURT DECISION CHANGES THE STANDARD FOR WHEN A CONSULTANT OR INDEPENDENT CONTRACTOR CAN BE CONSIDERED AN "EMPLOYEE" SUBJECT TO GOVERNMENT CODE 1090
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RECENT CALIFORNIA SUPREME COURT DECISION CHANGES THE STANDARD FOR WHEN A CONSULTANT OR INDEPENDENT CONTRACTOR CAN BE CONSIDERED AN "EMPLOYEE" SUBJECT TO GOVERNMENT CODE 1090
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7/19/2019 1:40:05 PM
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8/2/2017
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IDNA CW <br />BEST BEST & KRIEGER 113;7 SIG _tq C'9 a <br />ATTORNEYS AT LAW <br />CITY OF SA TA <br />Memorandum CL , r ;`„ i ,, <br />To: Public Agency Clients <br />From: Public Policy & Ethics Compliance Group of BB&K <br />Date: August 2, 2017 <br />Re: Recent. California Supreme Court Decision Changes the Standard for When a <br />Consultant or Independent Contractor Can Be Considered an "Employee". <br />Subject to Gcvemment Code § 1090 <br />In a January memo entitled: "CONSULTANTS: COMPLYING WITH THE <br />REPORTING REQUIREMENTS AND CONFLICT OF INTEREST PROVISIONS OF <br />THE POLITICAL REFORM ACT & GOVERNMENT CODE §1090," we discussed, <br />among other topics, the conflict of interest considerations for consultants under <br />Government Code section 1090. In that discussion, we reflected the then -prevailing <br />view of the appellate courts as to the circumstances that could lead to the conclusion <br />that a consultant qualifies as an "employee" subject to Government Code section 1090. <br />We wrote: <br />"The courts have held that `independent contractors who perform a public <br />function' and. `Whose,- official:; capacities carry the potential 10 exert <br />considerable influence over the contracting decisions of.a public agency' <br />(this is the critical test) qualify as `employees' under GC 1090. (See Davis <br />v. Fresno Unified School District (2105) 237 Cal.App.4th 261, 300-301; <br />Hub City Solid Waste Services, Inc. v. City of Compton (2010) 186 <br />Cal.AppAth 1114, 1124-1125; citing California Housing Finance Agency v. <br />Hanover/California Management & Accounting Center, Inc. (2007) 148 <br />Cai.App.4th 682, 690-693.)" <br />This "considerable influence" test is no longer the law in the wake of a California <br />Supreme Court decision handed down on June 26. In People v. Superior Court <br />(Sahlolbei), the Court held that a consultant or independent contractor can be <br />considered an "employee," and therefore come within the ambit of Government Code <br />section 1090, if "they have duties to engage in or advise on public contracting that they <br />are expected to carry out on the government's behalf." This is a different standard and <br />looks not to the "influence" wielded by the consultant on the agency, but simply looks to <br />what role or duties the consultant has to "advise" on public contracting. <br />A second element discussed in the January memo was what constituted the "making of <br />a contract in an official capacity," as applied to consultants. There we wrote: <br />93939.0000M9964650.1 <br />
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