AB5 creates ‘hurdle’ for truckers, California Trucking Association leader says

When it comes to emission regulations and the worker classification law, Assembly Bill 5, the leader of the California Trucking Association says the state’s policymakers are living in “fantasyland.”

Eric Sauer, president of the California Trucking Association, told Land Line Now earlier this week that both issues are leading to truck drivers leaving the state or the industry.

“That is a tremendous concern,” Sauer said. “Just the cost of doing business here is staggering. You have to navigate all these hurdles in laws and regulations. We’ve heard anecdotally that some independent contractors carriers we’re utilizing have moved on to other states or other trades.”

Whether it be clean-air standards or AB5, California has made an adversary out of many in the trucking industry. Last month, the U.S. Environmental Protection Agency gave California approval to implement regulations that will require half of all new heavy-duty vehicles to be electric by 2035.

Sauer said both issues are driving truckers out of the state.

AB5

California passed AB5 into law in 2019. Opponents of the law argued it would force the end of the owner-operator model in the state.

The California Trucking Association received a preliminary injunction in 2019 based off arguments that the law violated the Federal Aviation Administration Authorization Act. The injunction remained in place until late June 2022, when the U.S. Supreme Court denied the state trucking group’s petition for a hearing.

The case was sent back to the lower courts, and the Owner-Operator Independent Drivers Association has joined the California Trucking Association’s fight as an intervenor.

AB5 is based off the ABC Test, which makes it extremely difficult for a leased-on truck driver to be considered an independent contractor.

OOIDA is representing the rights of small-business truckers who travel in and out of California. The California Trucking Association and OOIDA claim that AB5 violates the Commerce Clause, which protects the right to engage in interstate commerce free of undue burdens and discrimination by state governments.

So far, the case has been moving slowly as response deadlines were recently delayed again. The state and the International Brotherhood of Teamsters now have until April 19 to respond to the complaint. The deadline for the California Trucking Association and OOIDA to respond will be May 10. A hearing is tentatively scheduled for June 12.

“I’m very confident with the work we’ve been doing with our attorneys, and we appreciate OOIDA’s (role) we appreciate in this fight,” Sauer said. “But it’s one of those things where we just have to let the court process see it through.”

Efforts to prevent federal version of AB5

Julie Su, who previously served as California’s labor commission, was nominated by President Joe Biden to be the next U.S. Labor Secretary. Opponents are concerned that Su would try to roll out AB5 on a national scale.

The Owner-Operator Independent Drivers Association wrote a letter to Senate offices on March 3 opposing Su’s nomination.

“We are concerned that Ms. Su would continue to pursue an ideologically motivated agenda toward worker classification that ignores the thousands of small-business truckers who depend on the ability to work as an independent contractor,” OOIDA wrote. “Make no mistake, if Ms. Su were to advance the same policies that she championed in California, it would force hundreds of thousands of truckers to change their business model and put their livelihood in jeopardy.”

Rep. Kevin Kiley, R-Calif., also has been a vocal opponent of Su, saying she is “the worst choice” the president could have made.

Kiley will be delivering the opening statement at a House subcommittee hearing on April 19 that will look at worker classification efforts.

Su’s confirmation hearing in the Senate is scheduled for April 20.

“We saw a lot of misclassification efforts spearheaded by her office,” Sauer said. “It’s going to be interesting to see how that plays out.” LL