Southern California Record

Friday, April 3, 2020

State judge says gig economy law does not apply to California truck drivers

State Court

By Rich Peters | Jan 20, 2020

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LOS ANGELES – A California state judge has ruled in favor of independent truckers across the state, temporarily halting a gig economy law that took effect at the turn of the year.

Assembly Bill 5, which makes it harder for employers to classify workers as contractors, doesn’t apply to trucking businesses, Los Angeles County Superior Court Judge William Highberger said in a Jan. 8 decision. The judge also ruled that AB 5 is preempted by the Federal Aviation Administration Authorization Act.

Last month, just hours before the bill was set to take action, U.S. District Court Judge Roger Benitez of the Southern District of California ordered a temporary exemption at the federal level and is now weighing a permanent injunction.

Both rulings come as wins for truckers as the California Trucking Association (CTA) last month filed a motion for preliminary injunction to cease enforcement of AB 5 on the industry altogether.

However, Joe Rajkovacz, director of governmental affairs and communications for the Western States Trucking Association, explained that this ruling stemmed from a case that was previously being tried and does not necessarily tie into recent the federal temporary exemption that was placed – although it can’t hurt their fight.

“It just indicates that there’s a judge in LA…who does not believe that you can use the ABC Test against trucking, and he did cite to the federal judge Benitez in San Diego who issued a temporary restraining order on the enforcement of AB 5,” he said.

“It’s not precedential…it’s a win for the defendant in that case, which is NFI (Industries)…it’s certainly a win there. It does mean that any other case before that judge – you clearly see what his legal rationale is – but the more important case is the one in federal court in San Diego.”

NFI Industries’ legal counsel, Gibson, Dunn & Crutcher along with Joshua Lipshutz, released a statement following the ruling.

“Independent owner-operator truck drivers have been a vital part of the trucking industry, and a path to achieving the American dream, for many decades," the statement said, as reported by Bloomberg. "Judge Highberger’s decision confirms that California cannot simply eliminate that business model and force truck drivers to be employees. This is a win for trucking companies and independent truckers nationwide.”

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Organizations in this Story

Western States Trucking AssociationLos Angeles County Superior Court