A judge has granted a preliminary injunction against California’s A.B. 5 law when it comes to truckers. The injunction bars authorities from enforcing AB5 against motor carriers until a lawsuit filed in opposition of A.B. 5 can be decided.
Judge Roger Benitez had granted truckers temporary relief just hours before the law went into effect on January 1st. Now, just three days after hearing oral arguments in a lawsuit brought by the California Trucking Association (CTA), Benitez has decided to award a temporary injunction. This allows owner-operators to continue business as usual at least until the case can be decided.
A.B. 5 is a California law aimed at so-called ‘gig economy’ companies like Uber and Lyft which rely on independent contractors for the majority of their services. Worker advocates claim that these gig workers should instead by classified as employees, and be eligible for all of the benefits that employees receive.
The new law institutes an “ABC” test for companies categorizing workers as independent contractors.
The three requirements are:
- That the worker is free from control and direction of the hiring entity
- That the worker performs work that is outside of the core business of the hiring entity
- That the worker engages in “an independently established trade, occupation or business.”
The judge’s temporary injunction comes too late for many owner-operators however. Reports indicate that many trucking companies started laying off California owner-operators in the lead up to AB5 to make sure that they wouldn’t run afoul of the law.
Now, those that are left are stuck in limbo, waiting to see how Benitez rules. Those drivers will likely have a long wait as any ruling is likely to be appealed by the losing side.
Source: overdrive, overdrive, truckinginfo, freightwaves, ttnews, truckersreport
We shut our business down 5 years ago. This type of the all knowing was a large reason for our decision. No business can stay on a tightrope for years. Somebody with some knowledge about running ANY business needs to step up. The rules & regulations they were fighting about when we retired are the same rules and regulations they are still fighting about today. Nobody can make plans and run a business with nothing but constant new regulations being imposed daily.
Welcome to California.
It will never change in that state!
The only way that state will change is to stop all trucking there.
Oh it might,
the collateral damage
Is certain on this: loads will cost more, way more, both into California and back out, it will impact industries besides Trucking because of the shortages of qualified drivers to move specialized & or dedicated loads, the gravy for an owner op. This law will result a slow down of goods moved trucking industry wide in California, why would you base your truck there, or buy fuel
there?
Even fleets are not “free from control” our pick up and delivery times are set by the broker. Some loads (chips) the route is designated by the shipper. Rates are set by the broker (we have the mirage of bartering the rate, but they have a set guideline. Detention IF OSID is set by the broker (and it comes from the broker, many times the shipper don’t even know about it)
It is not possible to do a job that is “outside” their core business. Their business is shipping goods, our business is shipping goods (CA is just full of intelligence)
As long as you are set up as n LLC or an INC, you are an independent, as long as you set your hours- you are an independent, as long as you own all the tools used to do your job, you are an independent.
NOW, lease to own truckers, if your truck is owned by the company and the company controls your loads, AND, if you decide to leave that company and they can take back control of the truck…. then you are an employee. This is where the circumvention of the law comes in, large “lease to own” companies.
Amen Michael !!! AMEN!!!!
EXACTLY!
In reality yes, but not in the eyes of the Kalifornia government.
That place is 10 million bushels of rotten apples beyond a fuit basket.
There is a deep irony in this law.
There are thousands of freelance writers that live in that state and who support every crazy leftist idea that originates there. Lots of them were supporting this law. Suddenly they are shocked and dismayed (and jobless) because they did not anticipate that this law will effect them as well.
It comes down to the money Period. if they cant fine, levy fees or collect taxes they are suddenly for “fair” treatment and worker rights.
They know a wise contractor can get his taxable income down where he/she pays little or no income taxes. If I have to explain, you either shouldn’t be a contractor or you are a company driver.
One example. One contractor one employee. Both make 1k per week hypothetically. Cell phone cost $100. Employee payst ax on 1k then cell phone with after tax dollars. contractor pays phone and then tax on what is left. Simplified yes but simple is usually best
You got it😊
Seems to me the rules and regulations are for which party. What will the end result be if all the rules are passed. CA just needs to let the trucking industry alone and let the truckers roll. How can anyone keep restricting the truckers ability to make a living and operate their vehicles safely when they are constantly inundated with, HOS, independent contractor, scale masters, periodic inspections, driver safety, regulations and changes? Let the people make a living and the ones (politicians especially) who want the changes , have their wants studied by a trucker oversight board, made up of a majority of truckers, and lets’ study the impact of the new rules before everything gets more confused causing potential safety issues on the road. tku for your time
It’s very simple.
Make sure That the worker is free from control and direction of the hiring entity
Make sure That the worker performs work that is outside of the core business of the hiring entity
Make sure That the worker engages in “an independently established trade, occupation or business.”
Why is it the the slime criminals in trucking are always looking for a loophole?
Why is it that people dont understand the owner operator business model that gas existed since freight moved on horse drawn wagons? THAT is whats simple.
This is nothing but a broke liberal state trying to prop up their budget by deciding they know how to run everybodies life better than the people do.
Cant make it as sn OO? Nobody is making anybody stay. Quit and get a job elsewhere. Nobody is forcing the port haulers to lease trucks without doing the math. Thats their own failure but they want the state to bail them,out.
So it sounds like according to your post that you are for this AB5 crap. So answer me this oh wise one. What’s wrong with being able to own your own truck an be leased on to a trucking company and living the American dream by running a successful business?
You have a got a clue comrade.
Frankly, it is none of government’s business how individuals conduct their lives as long as they do no harm to others.
Unfortunately, those who battle for their “rights” are usually the ones cast aside when the favorable decision comes in.
Take the employee drivers of the old Airborne Express cartage companies (non union drivers). Teamsters came in and organized several. Cartage company owners just closed their doors & AE contracted with another cartage company who was under no obligation to honor the Teamsters contract.
Same with the old Roadway Package System, now Fed Ex Ground. A lot of the current CSP contractors are people who showed up for the old P & D contractor meetings in the late 80’s & during the 90’s; but didn’t want to do the “grunt work” to get a route started. The CSP’s have been helped by FEG’s relaxation of hiring and vehicle standards.
I was an RPS P & D contractor from 1994 to 1999. I now see FEG CSP employee drivers that we would not have hired for temp drivers back in the 90’s. Also see equipment that would not meet RPS’s vehicle specifications.
Use deductive reasoning and figure out my point yourself.
Seems like the simplest way to make the differentiation is that not only should independent contractors a) own their own equipment, b) control their own scheduled, but c) set their own rates. Problem with Uber/Lyft is that drivers have no control over their rates/accessorials, so are totally at the mercy of the algorithm.
The Original law’s “A” is fine but the “B” and “C” ought to be “D” and “E”.
Actually they have complete control over the rates. If the rate is too low dont accept the dispatch. If nobody accepts the dispatch the rate goes up or the company(in this case uber or lyft) doesnt move the customer and thus doesnt make any money
SHAWN THATS HARD TO DO HERE IN CALIF WHEN YOU GOT DRIVER FROM A OTHER COUNTRIES COMING IN HERE AND HAULING LOADS THAT SHOULD PAY 500$ AND THEY DO IT FOR 200$.. CANT COMPETE AGAINST THAT..
We are in the age of corporate conglomeration. They have already slashed rates and used every trick in the book to maintain there required 10% profit above last year stock holders require to keep stocks in company and get dividends. Once independent operators are gone you can bet your last dollar transportation rates will go through the roof and exceed what they should be now. Free shipping by Amazon and other companys shows society has no interest in supporting truckers so long as they can still buy 10$ shirts and 20$ jeans.
Current Big business practices are unsustainable and can ONLY result in economic collaps .the more valuable you are the worse your treated so you don’t realize it group together and get your fair share. And all they have to do is a give a few a little more so they stab everyone else in the back and break the line
Sounds like the American Dream is not alive and well in California.
Item number 1: All in the interpretation….yes we get direction
we are directed to PU and drop at a specific time., Sure we’re free to make our route, decide when and where to sleep etc. as for setting our hours, no the Feds set that. If they can’t figure out language in the bill to separate an Uber guy in his car working irregular
hours, from a trucker or a rigid time schedule, they obviously just don’t care. Same way they dicked around the port drivers, still are.
All they are doing is raising the price on all goods in California, adding to an already high cost of living. Elitists
who don’t know how the real world works. And it’s so simple what they don’t understand, we truckers say this all the time. “Virtually everything in each of the legislators houses arrived in a truck”.
one more key factor: lobbyists for Swift, Knight, Schneider, etc
FMCSA 2010 or, as we actually know it, a coordinated industry friendly attack on the owner-op concept of trucking.
Well not everything can be drop & hook, fortunately. But if you own & reside in the state, this and the fuel tax must feel like an assault. Raising your rate, just makes it easier for the Swifts to take over those loads.
Flatbeds are relatively safe, but van drivers can’t compete.
A few years ago Swift added refer and flatbed, but I believe they gave up on flatbed later, as did other majors,
Flatbed, odd size loads, is the only safe haven left for an owner-op
It’s pretty much the same problem as what happens every time any legislature tries to pass a law about any other subject they know nothing of.
So you get congressbeings who have never held a firearm making firearm laws, who have never installed their own operating system making computer laws, and now, those who have never even touched a big truck in person making laws about how they should be run.
They need to get their own authority..and be a true ” OWNER Operator.If you are operating under someone else’s then you are under thei wing….The part they are doing for you is relatively easy ,it is the money for fuel,tires ,repairs,permits,taxes.TheOO,s pay them they are just getting advances from the authority.They keep a percent of the load…f that.I went from company driver directly to LLC.It is a little complicated at first but that’s how you learn.The people your running under prob wont help you.The OOs just might get paid on this deal…back Social security..whatever an employee gets.Its the ones 1099ing them that are running scared but closing doors wont prevent them coming at you for past discepancy.
Filing bankruptcy will.
DONT GO TO CALIFORNIA!!!!! REFUSE ALL LOADS!!!!! LET THEM STARVE!!!!!!
AMEN John !!
If all the truck drivers would band together and refused to haul freight in to California and out the political B’s would go away when there nothing to buy they might get hungry.
If we all banded together and refused ro haul freight in California, Mexican carriers would come up from across the border. Uber and Argo would be invited to deploy automated trucks on California highways. The Governor would call up the National Guard, if necessary.
We have to stop thinking that we are irreplaceable. There are other modes of transportation, and other forms of ground transportation. Last mile delivery can be done by drones, automated, or piloted remotely from anywhere. There is nothing that we do that cannot be done another way. We’re not even consistently the cheapest or the fastest or the safest or the best. Stop pretending that if the serfs band together and refuse to farm, that it will be the royals who starve. It won’t be. And it isn’t hard to find more serfs that are hungry enough to want to work the farmland, after the self-important know-it-alls have died off.
> If we all banded together and refused ro haul freight in California, Mexican carriers would come up from across the border.
I think the feds might have something to say about that.
> Uber and Argo would be invited to deploy automated trucks on California highways.
Yeah, this one might happen.
> The Governor would call up the National Guard, if necessary.
To do… what? Force drivers from other states to haul loads into and out of CA? To drive the trucks themselves? I don’t think the NG *has* many 18 wheelers…
This truck leasing BS needs to be revamped. Companies want to rent a truck and control every aspect of running the truck; that is not a business lease, that is a company driver. A business lease should give driver full responsibility of all aspects of governing and operations of the truck.
And this I why i don’t go to west and would never live there….just too much
A manufactures paper towels in Humboldt County. B is a freight broker in San Francisco. C is an owner-operator in San Bernardino. A has a load to go from the factory to a distribution warehouse in Fontana, to leave on a certain day and arrive by the next morning. C will be unloading in Eureka then and needs a return load. A and C contact B looking for counterparties. B connects them and they make a deal.
Under AB 5, C is an independent contractor. A and B do not control how C gets the load from the factory to the warehouse, just when. A’s core business is making paper towels, B’s is brokerage, and C’s is operating the truck. C’s business is independent of B’s and A’s. No problem.
Now assume C is a fleet and (c) leases from the fleet and receives a schedule from the fleet saying where and when to drive. C controls (c)’s work; what (c) does is C’s core business; and (c) is not an independent carrier. Consequently (c) is an employee of C under AB 5.
So AB 5 leaves the driver alone in the first example, and in the second example it tries to keep the driver from getting screwed by rates and lease terms set by the fleet. The fleet will have adopted its model because it allows the fleet to control its net labor cost at will, like a firm selling workers food at a company store and renting them company housing; an employee-employer model will thus probably amount to a raise for the drivers. As for increased costs, consumers will pay any portion not ultimately absorbed by the seller of the product based on its demand curve.
Also, the increased cost to fleets would raise the rates they would have to charge shippers, potentially giving true contractors like the driver in the first example a competitive advantage.
So what’s with the hysteria about the National Guard and the American Dream bad California and so forth?