USA TODAY International Edition
California bill targets trucker abuse
It would increase big stores’ burden in labor violations
The California legislature has passed a bill to hold retail companies jointly responsible for labor violations at their port trucking providers, marking a drastic shift in the relationship between the nation’s most powerful brands and those who deliver their goods in the Los Angeles harbor.
Democratic Sen. Ricardo Lara’s bill, the first of its kind to spread financial liability up the supply chain, follows the USA TODAY investigative series “Rigged,” which published last year. The series chronicled rampant labor abuse at dozens of trucking companies operating out of Los Angeles and Long Beach, the country’s two largest ports, and showed how the system benefits major retail brands such as Target and Costco.
In response to changing environmental rules a decade ago, trucking companies saddled drivers with debt and forced them to work around the clock, USA TODAY found. Many companies ignored the labor judgments against them – which have totaled more than $40 million – with tactics that included shutting down the company and then reopening under a new name. Meanwhile, the companies continued to haul containers for big-box retailers across the country.
Lara’s legislation would create a public list of the trucking companies that haven’t paid or appealed those labor judgments and then hold brands that continue to work with them financially liable for any future violations.
Lara said the “blacklist” will hold retailers accountable “so nobody can say they had no idea what was happening.” His law would give importers an extended period to vet port trucking operations against the list and pull contracts.
“If we put the onus on the retailers,” he added, “they have the power and bandwidth to rectify what’s been happening for so many years.”
Later this month, Gov. Jerry Brown will sign or veto the bill, which passed the Assembly 53-26 and was approved by the Senate on a 26-12 vote last Friday.
Where do big stores stand?
Retail companies haven’t mounted a strong resistance to the legislation, despite its global implications. One national industry trade group recently withdrew its public opposition after a series of meetings with the bill’s sponsors, including the Teamsters union.
A year of negotiations with the trucking industry and companies such as Target helped move the bill forward, said Barry Broad, a labor lawyer and union lobbyist in Sacramento who helped construct the new regulation.
“I think they all basically recognized the problem, and they agree it’s time to fix it,” he added.
Officials from Costco declined to comment. The Retail Industry Leaders Association, which represents most major brands, did not immediately respond to requests for comment.
Home Depot spokesman Stephen Holmes said, “We’re committed to the fair treatment of all the drivers and expect the same from our carriers, regardless of legislation.”
Target spokesperson Jenna Reck said in a statement that the company has had a series of “meaningful conversations” with Lara about the bill.
The retail giant also wrote a letter to Long Beach councilwoman Lena Gonzalez in May. Target Senior Director David Davis did not take an explicit stance on the bill but wrote that he encouraged authorities to “explore appropriate measures” for protecting port truckers.
The legislation comes after more than a year of intense public pressure from consumers, investors, labor groups and prominent lawmakers, including letter-writing campaigns from U.S. Sens. Bernie Sanders, I-Vt., and Sherrod Brown, D-Ohio, civil lawsuits from the City of Los Angeles and a “port truckers bill of rights” introduced by House Democrats. Some companies, including Costco, dropped their port trucking contractors in light of USA TODAY’s reporting.
‘List of the supervillains’
Experts say the type of regulation in the California bill is relatively unprecedented because the unambiguous policy language shifts some of the burden of responsibility onto the retailers at the top of the supply chain.
“It’s pretty creative and pretty aggressive,” said Shawn MacDonald, CEO of the international research firm Verité, which produces labor and logistics studies commissioned by the federal government. He said such strong signals from the government is a “rare circumstance” in any industry.
Retailers and manufacturers don’t often hire the truckers directly. They rely on a maze of subcontractors to move their goods and have paid little attention to whom their direct vendors hire.
But architects of the legislation and those who have analyzed it say creating a public list of companies with unpaid judgments will create a clear line of sight between importers and their trucking providers.
“Here is a list of the supervillains,” said MacDonald, summarizing the legislation’s intent. “For God’s sake, fax or email it around.”
It’s unclear whether the standards in Lara’s bill will ultimately become law in other states with ports, but California does have a history of creating progressive policies that are adopted elsewhere.
“When something happens in California, it’s often copied by others,” said MacDonald. “That always makes it more important to pay attention there.”