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U.S. Supreme Court Refuses to Hear CA Trucking’s AB 5 Case

The California Legislature and governor created the trucking crisis with AB 5 but can reverse it

By Katy Grimes, July 6, 2022 7:41 am

The U.S. Supreme Court has declined to hear the California Trucking Association’s petition in the case regarding California’s Assembly Bill 5 independent contractor law. The decision could force California’s 70,000 independent truck owner-operators to stop driving in the state, which is already suffering from supply-chain backlogs.

AB 5, the 2019 state law authored by Democrat Assemblywoman Lorena Gonzalez, completely redefined independent contractors in California, as well as greatly reducing the number of contractors in the state by creating an “ABC test” that instead made them employees, or put them out of work.

AB 5 was passed by Democrats in the California Legislature and signed into law in 2019 by Gov. Gavin Newsom.

The stated intent of AB 5 was to force “Gig Economy” rideshare companies to reclassify their drivers as employees, rather than allowing them to work as independent contractors, which would destroy the company’s very business model, and make the drivers susceptible to unionization.

AB5 didn’t just target California’s “gig economy;” it outlawed all independent contractors with few exceptions – including independent truckers.

Gov. Gavin Newsom was supportive of the takeover of independent contractors. In an op ed, Newsom said, “Reversing the trend of misclassification is a necessary and important step to improve the lives of working people. That’s why, this Labor Day, I am proud to be supporting Assembly Bill 5, which extends critical labor protections to more workers by curbing misclassification.”

Truckers sued right away, and in January 2021, they won in state court: The Superior Court of California in Los Angeles ruled that independent truckers were exempted from AB 5. The court found that the law violated the 1994 Federal Aviation Administration Authorization Act​ (FAAAA), effectively giving independent truckers the right to operate in every state to (1) make uniform federal laws possible for easy interstate commerce, and (2) to create fair competition, the Globe reported.

The California Attorney General promptly appealed the decision, and the 9th U.S. Circuit Court of Appeals ruled 2-1 in April 2021 that truckers would no longer be exempt from the state’s AB 5 worker classification law, forcing many to become employees rather than independent contractors.

In May 2021, the California Trucking Association requested a rehearing over the Appellate Court ruling.

By August 2021 the California Trucking Association filed a petition with the U.S. Supreme Court to go over California’s AB 5 contractor law and argue that they should remain exempt due to federal protections. At issue: Whether the Federal Aviation Administration Authorization Act preempts the application to motor carriers of a state worker-classification law that effectively precludes motor carriers from using independent owner-operators to provide trucking services, the SCOTUS Blog reported.

But, it appears once again that the United States Supreme Court is refusing to clean up messes made by states. The court refused to hear the case, rendering the 9th Circuit Court decision effective.

“Gasoline has been poured on the fire that is our ongoing supply-chain crisis,” the California Trucking Association said in a statement following the Supreme Court’s decision to deny a judicial review of a decision of a lower court, a process known as certiorari, Bloomberg reported.

“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 CTA said.

The CTA is right, and they have been all along. However, this is a crisis created by the California Legislature and Governor, and can and should be reversed by the Legislature and Governor.

The problem with AB 5 is that the bill was based on the legally flawed California Supreme Court Dynamex decision.

In 2018, the California Supreme Court’s decision in Dynamex Operations West, Inc. v. Superior Court of Los Angeles dealt a blow to independent contractors. The Court ruled that the Dynamex delivery drivers were employees, rejecting its own prior test for determining whether workers should be classified as either employees or independent contractors,” Forbes reported.

According to many legal analysts, what the Court did was legislate from the bench by adopting a new rule for the narrow purpose of interpreting California’s Industrial Welfare Commission’s wage orders.

This is a legal mess made by the State of California, its lawmakers, and State Supreme Court. The U.S. Supreme Court is right by bouncing the case right back to the state to live with or solve, as it has done recently with Roe v. Wade, and even with Biden v. Texas.

But that doesn’t help the truckers right now.

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18 thoughts on “U.S. Supreme Court Refuses to Hear CA Trucking’s AB 5 Case

  1. This is clearly an emergency situation for independent truckers and for Californians and AB5, which has been an unnecessary and disastrous law from the very beginning, MUST now be reversed by the Gov and legislature ASAP. But where are they when we actually need them? No comment….

  2. Just as POTUS Donald Trump and a Republican Senate transformed the SCOTUS, California must elect a like-minded governor and legislature in transforming the California Supreme Court. Judicial “activism” must be removed before the effects of their horrible rulings metastasize into the fabric of the economy and into the daily lives of California citizens. Elections have consequences; as the people of SF and LA have discovered with district attorneys Boudin and Gascon. Making the same mistake over and over again, is the definition of stupidity.

  3. Oh you think inflation is bad now wait 90 days California will be dead. Independent contractor truck drivers work for larger company’s and in doing so enjoy low cost insurance. It doesn’t matter if you have 20 years experience your considered a new entrant and insurance alone will triple MOST of these guys wont be able to afford this increase and those that do will have to raise rates by huge margins and that will be passed on to consumers can you imagine if we only get a 30% increase in rates inside Ca. That’s 30% more you’ll pay for EVERYTHING because if you got it a TRUCKER brought it.

    1. lol .. California will be fine, as always … so will the truckers
      “The International Brotherhood of Teamsters, which represents about 1.2 million US and Canada workers mainly in trucking, says the law will avoid misclassification and will guarantee independent contractors are paid fair wages, benefits and employee-related fees.

      “Over the last decade, the California Labor Commissioner found misclassification is rampant at our ports,” Randy Cammack, president of Teamsters Joint Council 42, said in a statement. “The race to the bottom in trucking is going to end.”

      Since 2012, the California Labor Commissioner’s Office issued about 500 decisions finding that port trucking companies had misclassified drivers, ordering them to pay over $50 million to these workers.

      “We’ll blame AB5 for everything that really is a result of decades of deregulation in the trucking industry,” Gonzalez said. “This is a constant bogeyman.””

      1. What does that have to do with independent contractors who haul agricultural products i.e. fruit, logs or anything else that’s local??! Why should I as a company have to put them on my workers comp insurance and offer them other benefits when they are self-employed, self insured, and are not under the direction of anyone other than themselves?! California is in a trucking crisis and yes in part that is due to Newsom! We tried to vote him out, everyone you talk to voted against him.. interesting that he somehow still won…IDK??!

          1. Yeah, the scorched-earth destruction wrought by one person, Gavin Newsom, since 2019 has been like nothing else Californians have EVER seen. He is probably proud of it, because it serves his purposes, but it has been beyond crippling and debilitating and soul-shattering for residents of this state. Was that your point?

  4. Just ban California from being a state.
    They are NOT American by any stretch of the imagination. Every law they pass is insanity. Gavin Newsome has proved to be a wild Dictator, yet when they had a chance to get rid of him, they kept him. Every senator from Calif. Is incompetent trash. Just let them be their own country and ignore them. Stay out of the place.

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