AB5 still pending
Two recent petitions filed to the U.S. Supreme Court were tied to trucking and California’s worker classification law, Assembly Bill 5. On Oct. 4, the Supreme Court denied one of those petitions. However, the other case – and a preliminary injunction blocking AB5 from being enforced on motor carriers – remained in play as of press time in mid-October.
The Supreme Court on Oct. 4 denied a petition from Cal Cartage Transportation Express to hear the trucking company’s case that California’s AB5 is preempted by federal law.
The California Trucking Association’s case, which is tied to the injunction, was still pending.
There was some confusion regarding which case had been denied. Reuters published a story on Oct. 4 that the high court had rejected the California Trucking Association’s petition. The trucking group told Land Line on Oct. 5 that the Reuters report was incorrect and that they aren’t expecting to hear a decision on the case until late November or early December. Reuters corrected its article on the afternoon of Oct. 5.
“We’ve had to clarify that with several people,” said Shawn Yadon, CEO of the California Trucking Association. “Our case is still pending, and the preliminary injunction is still in place.”
The case argues that AB5 is in violation of the Federal Aviation Administration Authorization Act (F4A), which prevents states from enforcing a law or regulation related to a price, route or service of motor carriers. Groups opposed to AB5, including the Owner-Operator Independent Drivers Association, contend the law could force the end of the trucking industry’s owner-operator model.
Although the Cal Cartage case is over, it is still possible the Supreme Court will choose to hear the California Trucking Association’s case against AB5.
“The contributions of California’s 70,000 independent truckers have been vital to keeping the United States afloat during this supply chain crisis,” the California Trucking Association wrote in a statement following the Cal Cartage denial. “They deserve their day in court, and we are hopeful that the U.S. Supreme Court will grant the CTA’s petition in CTA vs. Bonta.”
The history
In 2018, the California Supreme Court’s Dynamex ruling established the ABC Test, which considers all workers to be employees unless the hiring business demonstrates that three factors are established. Those factors included the worker being free of control, as well as being from outside of the usual course of the hiring company’s business. The latter is the concern as trucking companies routinely contract with truck drivers for loads.
In September 2019, California State Senate passed AB5, which codified the California Supreme Court’s decision.
The law, which was intended to apply to a variety of industries, went into effect Jan. 1, 2020.
The California Trucking Association sued and the U.S. Southern District Court of California granted the preliminary injunction to stop the state from enforcing it on motor carriers.
On April 28, the U.S. Court of Appeals for the Ninth Circuit ruled 2-1 that California’s AB5 “is a generally applicable labor law” and called for the removal of a preliminary injunction against enforcing the state law on motor carriers. In June, the Ninth Circuit denied the California Trucking Association’s petition for a rehearing en banc (by the full panel of judges).
The California Trucking Association then filed a petition to the U.S. Supreme Court, and the injunction remains in place until the U.S. Supreme Court makes a decision.
OOIDA was one of more than a dozen organizations to file amicus briefs in support of the California Trucking Association’s petition.
“OOIDA urges the court to grant the petition for certiorari and settle this issue before the trucking industry must bear the burden of restructuring its workforce across the country to comply with California’s labor policy choices,” the Association wrote in its brief filed on Sept. 10.
The Cal Cartage case started in 2018 as a driver classification lawsuit. The company petitioned the Supreme Court in April. LL