The California Labor Commissioner found that part-time speech, physical, and occupational therapists were misclassified as independent contractors and cited their employer for more than $9 million. .
Los Angeles—The Labor Commissioner’s Office has cited Feld Care Therapy, Inc., located in Westlake Village, $9,041,100 for willfully misclassifying 1,280 speech, physical and occupational therapists as independent contractors. The part-time workers, who traveled to clients’ homes to provide care, were not given paid sick leave or California’s COVID-19 Supplemental Paid Sick Leave (SPSL) as required by law.
“During the height of the pandemic these misclassified therapists provided health care services while they were simultaneously being denied paid sick leave and COVID-19 SPSL,” said California Labor Commissioner Lilia García-Brower. “My office will continue to fight worker misclassification because it denies workers basic protections, undercuts law-abiding employers and robs public coffers.”
The Labor Commissioner’s Office opened its investigation into Feld Care Therapy, Inc., dba FeldCare Connects, in November 2020 after receiving a report of labor law violation that the company was incorrectly classifying employees as independent contractors. The Labor Commissioner’s Bureau of Field Enforcement conducted an audit of the company’s records from 2019 to 2022 and uncovered the willful misclassification and other violations, including workers not being provided with complete itemized wage statements.
Feld Care Therapy, Inc. and CEO Randi Peled are jointly and severally liable for $1,134,500 in damages owed to the 1,280 workers and a civil penalty of $1,677,500 for the violation of the itemized statement provision.
Feld Care Therapy, Inc. is liable for damages of $1,707,350 for failure to provide written notice of sick leave balance/usage, $1,554,850 for the violation of the supplemental sick leave provisions and $256,900 for paid sick leave recordkeeping requirements. Feld Care Therapy, Inc. is also liable for civil penalties of $2,710,000 for willful misclassification of employees as independent contractors. Civil penalties collected are transferred to the State’s general fund as required by law.
Misclassification occurs when an employer improperly classifies their employees as independent contractors to avoid paying minimum wage, overtime or payroll taxes. A misclassified worker is denied the legal right to workers’ compensation coverage if injured on the job, the right to family leave, the right to unemployment insurance, the right to organize or join a union, and protection against employer retaliation. Misclassification also undermines businesses that play by the rules.
Enforcement investigations typically include a payroll audit of the previous three years to determine minimum wage, overtime and other labor law violations, and to calculate payments owed and penalties due.
The Department of Industrial Relations’ Division of Labor Standards Enforcement (California Labor Commissioner’s Office) combats wage theft and unfair competition by investigating allegations of illegal and unfair business practices.
The Labor Commissioner’s Office in 2020 launched an interdisciplinary outreach campaign, “Reaching Every Californian.” The campaign amplifies basic protections and builds pathways to affected populations, so workers and employers understand legal protections and obligations, as well as the Labor Commissioner’s enforcement procedures. Californians can follow the Labor Commissioner on Facebook and Twitter.