WASHINGTON — The U.S. Supreme Court has decided against hearing the California Trucking Association’s case against a worker classification law known as Assembly Bill 5, or AB5.
The court made the announcement on June 30.
This means that the U.S. Court of Appeals for the Ninth Circuit’s ruling stands, thus eliminating the preliminary injunction preventing AB5 from being enforced on motor carriers.
AB5 essentially makes it more difficult for a worker to be considered an independent contractor.
Popularly known as the “gig worker bill,” the legislation requires companies that hire independent contractors to reclassify them as employees, with some exceptions.
This has many in the California trucking industry concerned about the future of the owner-operator.
AB5 was passed into law in 2019, but the lawsuit had prevented it from affecting the trucking industry.
“Gasoline has been poured on the fire that is our ongoing supply chain crisis,” the California Trucking Association (CTA) said in a statement. “In addition to the direct impact on California’s 70,000 owner-operators who have seven days to cease long-standing independent businesses, the impact of taking tens of thousands of truck drivers off the road will have devastating repercussions on an already fragile supply chain, increasing costs and worsening runaway inflation.”
The Owner-Operator Independent Drivers Association (OOIDA), which filed an amicus brief in support of the CTA’s petition, said it was disappointed in the high court’s decision.
“With AB5 now set to go into effect, thousands of owner-operators driving in California face an uncertain future,” OOIDA President Todd Spencer said. “California has provided no guidance to owner-operators about how they can work as independent contractors under this new scheme, and truckers will be at the mercy of the courts to interpret how the law will be applied.
“For truckers that have invested their blood, sweat and treasure to create their own businesses, it is dismaying that lawmakers and the courts are forging ahead with this radical policy that dismisses a beneficial business model that has been in place for decades. At the same time, we know this will not be the last word on the legality of AB5 and expect to participate in future challenges to the law.”
Meanwhile, the California Attorney’s General Office heralded the decision.
“We’re pleased with the court’s decision to reject this challenge to AB 5’s application to the motor carrier industry,” a spokesperson said, according to OOIDA’s publication Land Line. “At the California Department of Justice, we’ll continue to do our part to defend laws that are designed to protect workers and ensure fair labor and business practices.”
CTA officials said they believe that AB5 violates the constitution and could force the end of the trucking industry’s owner-operator model. But the U.S. solicitor general recently advised the court to deny the CTA’s petition, saying that AB5 would not have a significant impact on prices, routes or services
The Trucker News Staff produces engaging content for not only TheTrucker.com, but also The Trucker Newspaper, which has been serving the trucking industry for more than 30 years. With a focus on drivers, the Trucker News Staff aims to provide relevant, objective content pertaining to the trucking segment of the transportation industry. The Trucker News Staff is based in Little Rock, Arkansas.