Arkansas Trucking Association

Up Front- Vital Role at Risk

Shannon Newton
President, ATA

The heavy task of delivering 10.23 billion tons of America’s freight every year takes millions of people. Millions of people, fulfilling different roles—some put on a uniform before grabbing company keys, others invest in their own class 8 tractor, or pop the hood to maintain the machines, pick up the phones and create efficient routes, train the next generation of drivers or keep the books. Every role matters. An unreasonable burden to interstate commerce would be to dismantle one of the most critical roles—the owner-operator.

For nearly three decades, the Federal Aviation Administration Authorization Act has forbidden states from enacting laws relating to prices, routes and services of motor carriers to avoid an unreasonable burden on interstate commerce.

However, California Assembly Bill 5 (AB5), popularly known as the “gig worker bill,” essentially requires companies that hire independent contractors to reclassify them as employees. Enforcing an ABC test all but eliminates a motor carriers’ ability to contract with an owner-operator because they are both in the business of transporting goods for hire.

California Trucking Association challenged the state’s law because it violates FAAAA, and an injunction kept the law from enforcement. But upon appeal, the Ninth Circuit did not agree, so CTA petitioned the United States Supreme Court to review the case.

Before SCOTUS ended its most recent session on June 30, the justices declined to hear CTA’s arguments for federal preemption. The injunction will soon end, endangering the jobs of California’s 70,000 owner-operators and stripping them of their choice to be their own boss.

These individuals had taken control of their careers. They could refuse loads, take vacations and support their families in a way that works for their individual circumstances. Ending the independent contractor model is not just a legal decision; it squashes livelihoods, causing financial devastation for those who have to start their careers over as employees or relocate to preserve their businesses.

Our industry will no doubt be challenged without the entrepreneurial, dedicated men and women who have taken ownership of their careers and delivered for our country and their own households. Consumers will notice when the already-stressed supply chain loses another link and prices increase, but for the ones behind the wheel of their own trucks, the impact will be personal.

There’s a lot we don’t yet know about the state law and just how far it reaches outside California’s borders. Any motor carrier leasing an owner-operator under federal leasing regulations in the state is at risk. Will the ABC test apply just to drivers who reside in California? What about drivers who live elsewhere but contract with companies in California?  Or the drivers who live in Arkansas, work for Arkansas companies but pick up a load of avocados in San Diego or almonds in Bakersfield?

What I do know is that the fight isn’t over. We need the voices of owner-operators and the companies who contract with them to share why this role is important, why you chose to be your own boss and what’s at stake if you lose that choice.