The Sun (San Bernardino)

70,000 truckers in limbo; supply chain worries arise

- By Augusta Saraiva and Ngai Yeung

About 70,000 truck owner-operators who form the bedrock of California’s transport industry are in limbo as state-level labor rules start applying to them, creating another choke point in stressed U.S. supply chains.

Almost a dozen truckers said they’re unsure how to comply with California’s Assembly Bill 5, which requires workers satisfy a three-part test to be considered independen­t contractor­s,or else be seen as employees entitled to job benefits. The trucking industry relies on contractor­s — who until now have had flexibilit­y to operate on their own terms — and has fought to be exempt from state regulation­s for years.

California truck owner-operators must now comply with AB 5 after the Supreme Court on June 30 refused to review a case challengin­g the legislatio­n that sets out the tests for employment-status classifica­tion.

Off the road

The California Trucking Associatio­n, which brought that challenge, estimates the law may push thousands of independen­t truckers off the road while they take the necessary steps to comply with the new regulation­s.

More than 70% of truckers serving some of the country’s largest ports — including Los Angeles, Long Beach and Oakland — are owner-operators, and AB 5 will govern their relationsh­ips with carriers, brokers and shippers in most cases, according to the CTA.

“We have never gotten any good answers from anyone official in California on how this is supposed to be enforced or how our members can comply,” said Norita Taylor, the director of public relations at the Owner-Operator Independen­t Drivers Associatio­n.

The law comes into effect for truckers in the busiest months of the year as retailers stock up on back-to-school and holiday goods. At the same time, dockworker­s and railroad workers are currently negotiatin­g contracts with their respective employers. Additional transporta­tion snarls would only worsen pandemic-era supply-chain chaos and add to inflationa­ry pressures, threatenin­g to slow economic growth.

“This denial couldn’t have come at a worse time,” said Eric Sauer, senior vice president for government affairs at the CTA. “We’re in peak harvest season. We’re also in peak constructi­on season. And this is the time for peak holiday imports coming into the ports.”

The Port of Long Beach is monitoring the trucking situation as AB 5 comes into effect.

“We understand the capacity concerns at this very busy time for the port complex,” Deputy Executive Director Noel Hacegaba said.

Exemptions, injunction­s

California passed AB 5 in 2019, aiming at gig-economy giants including Uber, Lyft and DoorDash.

But these companies won exemption, along with other profession­als, including musicians, freelance writers and architects.

The trucking industry scored a temporary injunction that remained in place until last week’s Supreme Court decision.

The timing of the decision is “nothing new,” said former Assemblywo­man Lorena Gonzalez, the Democrat who proposed the bill.

“They’ve known for the last 2½ years that it was equally possible that this injunction would not hold. This is not a shock.”

Still, some see in the law an opportunit­y to address longstandi­ng pitfalls within the industry.

The Internatio­nal Brotherhoo­d of Teamsters, which represents about 1.2 million U.S. and Canada workers mainly in trucking, says the law will avoid misclassif­ication and will guarantee independen­t contractor­s are paid fair wages, benefits and employee-related fees.

“Over the last decade, the California Labor Commission­er found misclassif­ication is rampant at our ports,” Randy Cammack, president of Teamsters Joint Council 42, said in a statement. “The race to the bottom in trucking is going to end.”

 ?? MARCIO JOSE SANCHEZ — THE ASSOCIATED PRESS ?? Truckers are unsure how to handle the implementa­tion of AB 5.
MARCIO JOSE SANCHEZ — THE ASSOCIATED PRESS Truckers are unsure how to handle the implementa­tion of AB 5.

Newspapers in English

Newspapers from United States