California Trucking Association Suing over New Independent Contractor Law

November 14, 2019

The California Trucking Association and two California independent owner-operator truck drivers have filed an amended complaint with the U.S. Southern District Court seeking declaratory and injunctive relief against California’s new independent contractor law.

The law codified the employment test set forth in the Dynamex Operations West Inc. v. Superior Court decision by the California Legislature in the form of Assembly Bill 5, which was passed by the California Legislature and signed into law on Sept. 11 by Gov. Gavin Newsom.

“AB 5 threatens the livelihood of more than 70,000 independent truckers,” said CTA ‘s CEO Shawn Yadon. “The bill wrongfully restricts their ability to provide services as owner-operators and, therefore, runs afoul of federal law.”

In the suit, plaintiffs argue that the classification test in the Dynamex decision and codified by AB 5 is preempted by the supremacy and commerce clauses in the U.S. Constitution and is in direct conflict with the Federal Motor Carrier Safety Act and the Federal Aviation Administration Authorization Act of 1994.

The new test denies a significant segment of the trucking industry the ability to continue operating as independent owner-operators in California, forcing them to abandon $150,000 investments in clean trucks and the right to set their own schedule and become their own boss.

AB 5, rather than addressing the issue of employee misclassification for all California workers, replaced a longstanding multi-factor test for determining independent contractor status with a one-size-fits-all method, consisting of highly restrictive criteria, riddled with carve-outs and exemptions for specific businesses and industries, the plaintiffs argue.

Under the new test, independent truckers will be forced to work as employees.

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