The Western States Trucking Association plans to protest a California Supreme Court Ruling that would make it difficult for transportation companies to use independent contractor drivers.
Earlier this year, the California Supreme Court ruled that the courier and delivery service company Dynamex had misclassified its drivers as independent contractors instead of employees in order to cut costs. The court then enacted a new standard for hiring independent workers, placing the burden of proof on the company to prove that a worker is being properly classified under a new “ABC” test. The test requires companies to prove that an independent contractor is free from the control and direction of a hiring entity, that the work a contractor does is not similar to the majority of the work done at a hiring company, and that the worker is customarily engaged in similar work in an independent context.
WSTA filed suit in July to challenge the Supreme Court ruling, and it plans to hold a rally at the California State Capitol in Sacramento on Aug. 15 to express to state legislators what it believes is at stake.
“This issue isn’t about ‘port drivers,’ but they will be the poster child for everything evil about the independent contractor model, and we are going to do everything to counteract that false narrative,” Joe Rajkovacz, director of government affairs and communications for WSTA, told Heavy Duty Trucking.
Truckers are not alone on this issue. Ride-sharing companies such as Uber and Lyft have a lot to lose if this new test is applied to their business models and have been reportedly lobbying state politicians to do something about it. In an Op-Ed in the Sacramento Bee, president and CEO of the lobbying group California Chamber of Commerce, Allan Zaremberg, called on the state to put a stop to the new standard, or at the very least limit its reach to only workers directly involved with Dynamex until a more fair broad standard could be created.
Proponents of the Supreme Court decision say the current independent contractor model allows companies to pay workers less than the minimum wage, and to avoid overtime pay or benefits that would be required for employees. The state could also be missing out on taxes of income that would be automatically taken out of an employee’s paycheck.
Port trucking companies, particularly in Southern California, have been hit with wage lawsuits for years from drivers or groups of drivers claiming to have been improperly classified as independent contractors. This has resulted in millions of dollars in judgements against these companies, putting some out of business.
