Judge puts new giglaw on hold for truckers
California truck drivers won another reprieve Thursday from AB5, the state’s new gigwork law.
A federal judge granted a preliminary injunction to the California Trucking Association to temporarily stop enforcement of AB5 against motor carriers. The judge, U.S. District Judge Roger Benitez, had previously granted an 11thhour emergency restraining order in the same case on New Year’s Eve, hours before the new law took effect on Jan. 1. That emergency order was in effect until he ruled on the request for a preliminary injunction.
The new preliminary injunction means that the state cannot pursue the trucking industry over AB5/Dynamex compliance until the full case, which holds that the new law is unconstitutional, is decided. Dynamex is a 2018 California Supreme Court decision that the law, AB5, codifies
Truck drivers are passionate about the issue of whether they should become employees, as could be mandated by AB5, or remain independent contractors. Many say they operate independent businesses and wish to remain selfemployed, having invested more than $150,000 apiece on their own big rigs. Others say they are exploited by
“There of California is little has question encroached that the on State Congress’ territory by eliminating motor carriers’ choice to use independent contractor drivers.”
Roger Benitez, U.S. District judge
shipping companies and brokers who pay them pittances for long hours, while their income is eaten up by unsustainable truck lease payments.
The trucking group argues that AB5 and Dynamex are preempted by the Constitution’s supremacy clause, as a 1994 federal law regulates trucking prices, routes and services.
Benitez appeared to side with the group’s arguments.
“There is little question that the State of California has encroached on Congress’ territory by eliminating motor carriers’ choice to use independent contractor drivers, a choice at the very heart of interstate trucking,” he wrote. “In so doing, California disregards Congress’ intent to deregulate interstate trucking, instead adopting a law that produces the patchwork of state regulations Congress sought to prevent. With AB5, California runs off the road and into the preemption ditch” of the 1994 federal law regulating motor carriers.
“This ruling is a significant win for California’s more than 70,000 independent owneroperators and CTA members who have worked as independent truckers for decades, and who have invested hundreds of thousands of dollars to own their own vehicle and comply with California’s strict environmental guidelines and regulations over the years,” Shawn Yadon, chief executive officer for the California Trucking Association, said in a statement.
Rome Aloise, vice president of the International Brotherhood of Teamsters, which is a defendant in the case along with California Attorney General Xavier Becerra, said the injunction meant the issue of driver classification for now would be decided by a previous labor standard, called Borello. Several dozen recent court cases under that standard found that drivers were employees, he said.
“For the most part, this is the biggest sham being perpetuated on workers in the trucking industry,” he said. “They’re not real owneroperators. They may have a truck they’re leasing and that tractor may have been leased by six or seven or eight people before them who went out of business. The old saying is ‘They’re either in it or under it.’ They’re either driving it or fixing it. They’re working for the same broker or company all the time.”
Aloise said he thinks provisions could be made to allow the drivers who truly are owneroperators to continue with that status.
“There are people who have flexibility to bid loads and take the highest priced ones — they’re legitimate owneroperators,” he said. “But the vast majority of these drivers work every day for the same broker or the same company at the direction of that company, doing that company’s bidding. Prior to deregulation, they were all employees. They’re really employees by every test imaginable.”
Becerra’s office said it is reviewing the decision.
“Our office has and will continue to defend laws that are designed to protect workers and ensure fair labor and business practices,” it said in an email.
In a separate case in the state courts that was further along in the judicial process, a Los Angeles Superior Court judge ruled last week that AB5 and Dynamex are preempted by the 1994 federal law.
In that case, California vs. Cal Cartage Transportation, Los Angeles City Attorney Mike Feuer sued trucking companies claiming they misclassified drivers at the ports of Los Angeles and Long Beach. Feuer plans to appeal the ruling.