Tag: AB-5 Regulations

AB-5 Update: Construction Truckers Covered

Bob Holtzman

In the ongoing legal battle surrounding California’s controversial AB-5 decision, which reclassifies truck drivers among other things, regional transportation associations have been looking for some guidance. The state’s Attorney general, trucking companies, independent trucking contractors, and Uber and Lyft are all involved in the matter, as all are trying to find common ground when it comes to classifying employees and obtaining the right benefits and insurance coverage.

But in recent weeks, the Western States Trucking Association, a non-profit trucking association that helps protects the rights of trucking companies, scored a major win against the AB-5 California mandate by forcing the government to renounce the plain language involved in the bill, and instead agree to treat construction trucking like all other motor carriers. While this AB-5 Win may seem small, it’s a step in the right direction for everyone from truckers to the companies they work for in the state.

As a result of this decision, all members of the construction trucking industry, a major player in the state’s economy, are now fully protected by the injunction against the ABC testing, which reclassifies workers.

The Dynamex Decision

In 2018, the Supreme Court of Los Angeles set the foundation for AB-5, which spurred on legislation that reclassified trucking professionals as employees instead of independent contractors. AB-5 codified the Dynamex decision and applied a test to any industry that was not given an exception in the law. Some of the exceptions included wholesale exemptions, meaning they could still use the traditional test.

However, only construction trucking was singled out for an exception that was worse than the ABC test itself. Under the terms of AB-5, construction trucking was called out to mandate an employment relationship between trucking independent contractors. Any time a trucking company sought to subcontract some or all of the construction trucking work on a particular construction trucking job, whether by using independent truckers or other trucking companies, they would be deemed the employers for all trucks working on that job.

The order now targeting WSTA’s complaint highlights that in light of the state’s interpretation of the law, their trucking members have no threat of something hanging over their heads when it comes to prosecution under the challenged provisions. As a result, WSTA members and construction trucking drivers are subject to the ABC test like everyone in the industry and are protected from the enforcement of the test.

About Western Truck Insurance Services

Western Truck Insurance Services is a commercial truck insurance agency with roots dating back to 1954. We have evolved into a highly respected, professionally managed, truck and transportation insurance brokerage. The hallmark of our organization is our desire to provide unparalleled service. We go way beyond what you expect to receive from an insurance brokerage. Equipped with state of the art automation, Western Truck Insurance can provide you with lightning fast truck insurance quotes, customer service, Insurance certificates, and coverage changes. Contact us today at (800) 937-8785 to learn more.

CA in Second Phase of Reopening After COVID-19

Bob Holtzman

As the spread of COVID-19 looks to be on a downward slope, states across the U.S. have begun to ease their social distancing restrictions, allowing people to head back outside, back to work, and back to doing some of their normal things, like eating at restaurants and retail shopping.

California’s Second Phase

But one of the hardest hit states, California, is rolling out its own reopening plan, opting for multiple stages and a slow release to get the state back to normal.

In recently released guidelines, Gov. Gavin Newsom has introduced Phase 2 of California’s reopening efforts, focusing on dine-in restaurants, shopping malls, office buildings, and more. Some parts of the state are allowed to reopen with certain modifications as long as the county gives the go-ahead. Those sectors also include logistics, which is directly tied to the trucking industry.

At this point, only 18 of the state’s 58 counties have been approved by the state government to reopen. In order to be approved for further reopening, counties must prove they meet the following criteria:

  • No more than one new COVID-19 case per 10,000 residents in the past 14 days
  • Essential workers must have access to PPE
  • At least 15 contact tracers per 100,000 residents
  • Ability to temporarily house 15% of the county’s homeless population
  • Continue to monitor metrics to potentially re-enact restrictions

Regardless of where they open in the state, restaurants, schools, and shopping centers will have to follow strict rules to reduce the risk of spreading the virus any further.

CA Reopening and Logistics

The logistics sector is directly tied to trucking, as pallets of products need to be held in one location, loaded on a truck, then moved to another location. From one location to another, many different working hands will handle the product. Trucking professionals, while they may not directly come in contact with the product they haul, are advised to follow the same strict guidelines as logistics and warehouse workers who do.

Before participating in CA reopening orders, all warehouse facilities must:

  • Perform a detailed risk assessment and implement a site-specific protection plan
  • Train employees on how to limit the spread of COVID-19, including how to screen themselves for symptoms and stay home if they have them
  • Implement individual control measures and screenings
  • Implement disinfecting protocols
  • Implement physical distancing guidelines

For further guidance, the California Department of Public Health and Cal/OSHA released specific outlines. The Logistics and Warehouse Guidance outlines certain protocols to be included in a company’s worksite-specific written plan, like cleaning delivery vehicles and equipment before and after a delivery is made, providing sanitation materials during deliveries, inspecting deliveries, and performing disinfection measures where appropriate before storing goods in warehouses.

Worker Guidelines

The guidelines also point to workers’ rights and expectations by highlighting the need to provide working time for workers to implement cleaning practices before and after shifts, minimizing transaction time between warehouse employees and transportation employees, such as truckers, staggering shifts and break times, and installing spacial barriers to aid in social distancing efforts.

Businesses involved in logistics, such as warehouses and trucking companies, must provide adequate employee training that covers CDC guidelines, hand washing, self-assessment at home, social distancing, and other protective measures. Furthermore, businesses must regularly evaluate the worksite for compliance with the guidance provided and make attempts to correct any deficiencies.

While trucking and logistics continue to thrive during these unprecedented times, the atmosphere around the industries, like all industries, has changed. And since California’s economy is heavily dependent upon these two sectors, it’s expected that they may be changed forever, having to following these guidelines and similar guidelines for the foreseeable future.

About Western Truck Insurance Services

Western Truck Insurance Services is a commercial truck insurance agency with roots dating back to 1954. We have evolved into a highly respected, professionally managed, truck and transportation insurance brokerage. The hallmark of our organization is our desire to provide unparalleled service. We go way beyond what you expect to receive from an insurance brokerage. Equipped with state of the art automation, Western Truck Insurance can provide you with lightning fast truck insurance quotes, customer service, Insurance certificates, and coverage changes. Contact us today at (800) 937-8785 to learn more!

AB-5 Legislation Update

Bob Holtzman

The state of California has asked a federal court to begin lifting the preliminary junction against imposing AB-5 on the state’s trucking industry. The requests to the Court of Appeals for the state’s 9th Circuit is part of the appeal of the attempt by the California Trucking Association (CTA) to be granted an injunction against the position that AB-5 has put the trucking industry in.

The state’s AB-5 Legislation has been a topic of controversy for over a year now. What it does is move 2018’s Dynamex California Supreme Court decision into law, which established an ABC test to determine the status of an independent contractor that could essentially eliminate the owner-operator model in California, and disrupting everything from investing in commercial truck insurance, such as general liability insurance, and the sharing economy.

According to the appeal by the attorney general’s office, the law set in place by the FAA in the early 90s “preempts state and local regulation that has a significant effect on the prices, routes or services of motor carriers.” This has been the position of the CTA as well and a case they have been trying to make since AB-5 began picking up steam last year.

The state’s appeal is mostly looking at the prices, routes, and services, as mentioned above, in the preliminary injunction. The state cited legal precedents that it said should be looked at as meaning that state labor regulations are not preempted by the Federal Aviation’s act.

Independent Contractors and Trucking Companies

If the argument that AB-5 doesn’t entirely ban the hiring of independent contractors as truck drivers by a company, the state’s argument stays focused on prices, routes, and services. The test brought on by AB-5, the ABC test, and the earlier standard used to decide if someone is a full-time employee or a contractor do not define the rights or benefits that a trucking carrier has to provide its drivers.

The state went on to argue that the decision to grant the injunction then offers no “substantive analysis on what impact labeling motor carriers’ drivers to be ‘employees’ will have on prices, routes, and services”. The state argues that what might be seen as a hurried nature of the CTA action is reason enough to overturn the injunction.

The state’s filing says the ABC test became a reality for trucking companies and their drivers with the Dynamex decision, which was put into place in April of 2018. However, the injunction wasn’t put into motion until December of 2019, plenty of time for the plaintiffs to seek injunctive relief during that time period.

About Western Truck Insurance Services
Western Truck Insurance Services is a commercial truck insurance agency with roots dating back to 1954. We have evolved into a highly respected, professionally managed, truck and transportation insurance brokerage. The hallmark of our organization is our desire to provide unparalleled service. We go way beyond what you expect to receive from an insurance brokerage. Equipped with state of the art automation, Western Truck Insurance can provide you with lightning fast truck insurance quotes, customer service, Insurance certificates, and coverage changes. Contact us today at (800) 937-8785 to learn more!