A strong economy in California has allowed the state to finally pay off its federal unemployment insurance loans. This means that the state federal unemployment tax (FUTA) rates should go back to the minimum rates by the end of 2018.
California’s Supreme Court ruling in the appeal of Dynamex Operations West, Inc. v. The Superior Court of Los Angeles County issued on April 30, 2018, has made the determination test much more stringent. With this single decision, the court has essentially transformed millions of independent contractors into full-time employees.
As of January 1, 2018 California's overtime minimum wage is one and a half times the current California minimum wage rates of $10.50 per hour for businesses employing 26 or more workers. For those employers with 25 or less, the current wage is set at a minimum of $10.50 per hour.
In late 2016, under President Obama, the DOL issued what was called the Final Rule, which would have raised the salary threshold for overtime eligibility from $455 per week to $913 per week.
There is still some confusion on the part of employers and managers regarding the "rules" for classifying workers as either an independent contractor vs employee. Much of this has stemmed from government agency's shifting interpretation of the existing guidelines.