FREDERICK, Md. -

The National Auto Auction Association said Wednesday that Larry Miles, senior attorney with The Miles Law Firm, recently won an important decision for the California auction industry.

NAAA indicated the victory involves the question of whether auto auctioneers are employees or independent contractors. Arguing that auto auctioneers are sufficiently unique in their skills and independent in their work to justify being deemed independent contractors, the association stated Miles persuaded the Employment Development Department administrative law judge to reject EDD efforts to classify the auctioneers as employees of the auto auction.

Association leadership explained the important decision comes on the heels of a new state law, SB 459, that imposes new penalties for businesses that “willfully” misclassify workers as independent contractors.

In addition to penalties of potentially $5,000 to $25,000 per infraction, the new statute requires the offending employer to announce their “willful” misclassification on their website for a year.

NAAA pointed out the new penalties are in addition to existing taxes and penalties that are due upon a redetermination by EDD.

California’s Labor and Workforce Development Agency will enforce the new law effective Jan. 1.