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California Supreme Court Rules Against Carrier in Misclassification Lawsuit

July 30, 2014

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The California Supreme Court issued a decision this week affirming the state’s labor and unemployment compensation laws are not preempted by federal statute, specifically the Federal Aviation Administration Authorization Act of 1994.

This case was brought by the State of California on behalf of owner-operators who claimed they were misclassified as independent contractors and for other alleged violations of state law, according to the California Construction Trucking Association. The owner-operator truck drivers were required to enter into lease-purchase agreements for trucks with defendant motor carrier Pac Anchor Transportation as a condition of employment.

The ruling clears the way for California Attorney General Kamala Harris to proceed with long-delayed lawsuit against Long Beach-based PAC Anchor Transportation.

The case was originally filed by the state in 2008 with a Los Angeles Court ruling in 2009 in favor of the trucking company. The case then went to an appellate court, which overturned the ruling, that was affirmed this week by the state high court, according to the Metropolitan News-Enterprise newspaper in Los Angeles.

“While both cases may be appealed to the U.S. Supreme Court, for right now they are having a chilling effect on motor carriers [in California] who have for years thought they were protected under the FAAAA,” said Joe Rajkovacz, director of governmental affairs and communications with the Western Trucking Alliance, an affiliate of CCTA.

Read more about it from the California Construction Trucking Association and  the Metropolitan News Enterprise newspaper.

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