Lawsuit Aims to Overturn California Ruling on Classifying Owner-Operators
The Western States Trucking Association has filed a suit in the United States Court for the Eastern District of California challenging the ruling by the California Supreme Court that is seen as effectively nulling the ability of trucking companies to use owner-operators in the state.
David Cullen・[Former] Business/Washington Contributing Editor
Ruling targeted by lawsuit signaled the end of working with owner-operators in California.
3 min to read
Ruling targeted by lawsuit signaled the end of working with owner-operators in California.
[|CREDIT|]
The Western States Trucking Association has filed suitin the United States Court for the Eastern District of California challenging the ruling by the California Supreme Court that is seen as effectively nulling the ability of trucking companies to use owner-operators in the state.
Ad Loading...
In the landmark Dynamex Operations West Inc. v. The Superior Court of Los Angeles County decision, the state Supreme Court ruled that certain workers-- in particular transportation drivers-- should be presumed employees instead of independent contractors when evaluating wage and hour classification in class action cases.
Ad Loading...
That’s a mouthful, but according to WSTA, the upshot is the ruling signaled the end of working with owner-operators in California. That’s because it requires a company using an independent contractor to ensure their classification is proper under the newly adopted “A-B-C” test, which consists of certifying:
A That the worker is free from the control and direction of the hiring entity in connection with the performance of the work, both under the contract for the performance of the work and in fact
B That the worker performs work that is outside the usual course of the hiring entity’s business
C That the worker is customarily engaged in an independently established trade, occupation, or business of the same nature as the work performed.
“Most legal analysis of the ruling agrees the A-B-C test sets an impossible standard for most of our members to meet,” WSTA stated to its members back in May.
According to Rob Moseley, an attorney with Smith Moore Leatherwood, it’s the “B” part that is problematic. “If you’re in the trucking business, it’s going to be a very difficult fight, because the ‘B’ prong of the A-B-C test basically says… the contractor has to be in a different business. They can’t be in your business.”
“Our intention is to nullify the [California] Supreme Court ruling that effectively eliminates the use of owner-operators, even one-truck motor carriers from the trucking marketplace,” Joe Rajkovacz, WSTA’s director of Governmental Affairs & Communications, told HDT on June 19.
Ad Loading...
“Our desired outcome is an immediate [federal] injunction against California utilizing an A-B-C test to determine employment classification in the trucking industry. Long term, [it should be] that California and its state agencies cannot utilize an A-B-C test in making employment classification decisions in the trucking industry.”
He added that as of now, “Virtually all entities in California utilizing independent contractors are at risk from predatory lawsuits because of the California Supreme Court decision in Dynamex. The trucking industry has unique legal protection under federal law from this type of decision.”
Rajkovacz noted that WSTA is also working with other organizations within the state for a legislative solution. “However, until and if, that can occur the trucking industry needs to be protected from this Supreme Court decision that amounted to legislating from the bench.”
Speaking at the TMC Annual Meeting in Nashville, ATA President Chris Spear said trucking faces mounting pressure from rising fuel prices, geopolitical instability, and uncertainty around trade policy.
More than 100,000 new trucking companies enter the industry each year, but regulators manage to audit only a fraction of them. That churn creates opportunities for inexperienced startups — and for “chameleon carriers” that shut down after safety violations and reappear under new identities. Read more from Deborah Lockridge in this commentary.
HDTX is an intimate event that connects heavy-duty trucking fleet managers with industry suppliers through small-group discussions, educational sessions, and structured one-on-one meetings.
Optimal Dynamics says its new Scale platform uses AI agents and optimization to help carriers find and secure freight that improves network balance and profitability.
NACFE's Run on Less - Messy Middle project demonstrates the power of data in helping to guide the future of alternative fuels and powertrains for heavy-duty trucks.
A federal court ruling allows New York City’s congestion pricing program to continue, leaving truck tolls in place for fleets delivering into Manhattan.
Fontaine Modification has introduced a new customer portal designed to give fleets real-time visibility into the truck modification process, addressing one of the most common questions fleet managers face: “Where’s my truck?”
Strong freight rates, rising volumes and tighter capacity push trucking conditions higher, though diesel prices could temper gains in the near term, FTR cautions.