Judge rules Last Minute, Temporary Exemption from California new Gig-work Law for Truck Drivers.

On January 1, a new California law (Assembly Bill 5) went into effect that forced many businesses to reclassify independent contractors as employees. Misclassification of employees has been a systemic issue in our current ‘gig’ economy. Independent contractors do not receive the full benefits and protections that employees receive, and so the goal of the law was to extend benefits to workers who had not received things like healthcare and retirement assistance as contractors.

On New Years Eve, 2019, a San Diego judge granted a temporary exemption to AB 5 for independent truck drivers.

The California Trucking Association argued that there there was a conflict in interest in the three criteria items that a person needs to meet in order to be considered a contractor. This set of criteria is referred to as the “ABC” test, and includes the following:

1. The worker in question is not controlled by the company nor do they take direction from the company on how to perform their job duties.

2. The worker in question performs work that does not contribute to the usual business the company performs.

3. The worker in question is regularly occupied by a trade or business of the same nature of the work performed for the company.

The California Trucking Association argued that the criteria for performing work outside of the company’s normal scope of business (B) violates a 1994 federal statute that prohibits states from passing laws that interfere with the price, route, or service of a freight-hauling motor carrier. The judge hearing the case agreed to a temporary exemption to AB 5 for all truck drivers in California due to that conflict, which means that they may still operate as independent contractors.

This is an interesting development surrounding state employment law, but the fight is far from over. Misclassification is still a major issue, and it seems clear that the trucking industry is going to need some overhaul changes in the near future. If you or a loved one has been misclassified, call us today about representation.