California governor signs OOIDA-backed bill to deter ‘mistreatment’ of truckers

(Courtesy Port of Los Angles)

A new law in California is intended to end the “rampant exploitation” of truck drivers who haul cargo from the state’s ports. It takes effect on Jan. 1, 2019.

About 25,000 truck drivers move goods between California’s 11 ports and various inland distribution centers, according to a bill analysis. In fact, more than 40 percent of U.S. shipping-container traffic flows through the ports of Los Angeles, Long Beach and Oakland.

On. Sept. 22, Gov. Jerry Brown signed into law a bill, SB1402, to deter shippers from using port drayage motor carriers who have unpaid wage, tax, and worker’s compensation liabilities.

“Gov. Brown’s signing of SB1402 will allow port truck drivers to share in the benefits from California’s leading role in global trade,” Sen. Ricardo Lara, D-Bell Gardens, said in prepared remarks.

The new law requires joint and several liability for customers who contract with port drayage carriers who have unsatisfied judgments regarding unpaid wages, damages, expenses, penalties, and workers’ compensation liability.

The state labor commissioner will be charged with creating a list of trucking companies to show who has failed to pay final judgments. Retailers such as Target, Home Depot and Amazon that hire port trucking companies with final judgments would be liable for future state labor and employment law violations by these companies.

The new rule includes a 90-day grace period from the time a carrier is included on the list. The grace period gives retailers time to cancel contracts before joint liability begins.

“Retailers using their power to end exploitation and restore good jobs for workers at our ports will mean port truckers are left behind no more,” Lara stated.

Lara has said an investigation a year ago by USA Today highlights the need for change. He referred to the investigation’s findings that “port trucking companies in Southern California have spent the past decade forcing drivers to finance their own trucks by taking on debt they could not afford.”

He added that the investigation found instances where drivers “end up owing money to their employers – essentially working for free.”

OOIDA support
The Owner-Operator Independent Drivers Association supports the bill’s passage.

The Association has more than 160,000 members nationwide, including about 5,380 residing in California and thousands more that operate on the state’s highways and ports each day.

Mike Matousek, OOIDA’s manager of government affairs, says many of California’s port drayage drivers are mistreated. He cites the long hours drivers work in “awful conditions” while being “utterly undercompensated.”

“We’ve long considered it to be a modern form of indentured servitude,” he said.

Matousek adds that the workers are also often misclassified through what are called “lease-purchase” agreements. He describes the agreements as “schemes where motor carriers lease a truck to a driver with the promise of fair compensation, future ownership of the truck, and ‘independence’ from traditional employer-employee requirements.”

In reality, these indentured servants are paid pennies on the dollar, will likely never own the truck, and have zero independence.”

Matousek said the new law addresses concerns about lease-purchase agreements without jeopardizing legitimate business agreements between motor carriers and leased owner-operators.

“SB1402 meets both of these goals and holds others in the supply chain accountable for using carriers that are known to misclassify workers,” he said.

To view other legislative activities of interest for California, click here.