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U.S. HOUSE BILL MODELS
CALIFORNIA AB5 LAW
The U.S. House of Representatives has passed legislation similar
to California’s AB5 law in that it requires employers to prove that
independent contractors used in conducting business should not be
classified as employees. The controversial California law, as applied to
the trucking industry, is currently under an injunction imposed by a U.S.
District Court judge that prohibits its enforcement.
California-based carriers, the California Trucking Association (CTA),
and owner-operators doing business in the state, as well as trucking
organizations on national and state levels, have all publicly opposed
AB5. Industry leaders have long feared a law like AB5 would spread
beyond California’s borders. With Congress considering the “Protecting
the Right to Organize” (PRO) Act (HR 2474), those fears appear credible.
As widely discussed in trucking-industry circles, AB5 places the
burden upon employers when classifying workers as employees or
independent contractors. If a worker’s circumstances do not pass all
components of a three-prong test, the individual is deemed an employee,
a classification impacting company operations and the individual’s ability
to choose working status. For this reason, many owner-operators who
entered the business for its self-employment opportunities oppose AB5.
The federal PRO Act legislation aims to apply the same test imposed
under AB5 nationwide. CTA contends that AB5 is prohibited under
federal law, an argument with which the judge ruling in favor of the
request for an injunction appeared to agree. With the injunction in place,
the PRO Act could be considered a case of amending federal law for the
purpose of allowing a state law to be enforceable.
The language in the federal act as included in Section 2(a)(2) defines
an employee under the same terms as AB5. As with the California law,
the sticking point relates to the (B) prong of the test. Under this prong, a
company cannot hire an independent contractor to perform tasks inherent
to the company’s business which other employees already perform. A
carrier in the business of moving freight and employing individuals who
move freight could not hire an independent contractor to perform similar
tasks.
Owner-operators and carriers are wary of California’s AB5
morphing into federal law. Introduced as the PRO Act, the
proposed legislation would have far-reaching impacts on all
sectors of the trucking industry.
“It’s important that this legislation not move forward because it
basically calls into question the entire independent contractor model
our industry has been using for literally decades now,” said Truckload
Carriers Association Vice President of Government Affairs David Heller.
“Our understanding and hope is that the Senate will not take up the bill.”
Heller called into question what he referred to as negative press, saying
while there are a few bad apples abusing the independent-contractor
model, a vast majority of carriers are using the model appropriately.
“Independent contractors are independent contractors because that’s
what they want to be,” added Heller.
But should the PRO Act receive U.S. Senate approval, it would be
passed to President Donald Trump to either sign into law or veto. A veto
seems likely as the Administration has stated the PRO Act “appears to
cut and paste the core provisions of California’s controversial AB5,
which severely restricts self-employment. AB5 is actively threatening
the existence of both the franchise business sector and the gig economy
in California. It would be a serious mistake for Congress to impose this
flawed job-killing policy on the entire country.”
Truck drivers nationwide should remain in tune with further action on
the PRO Act. It may impact many careers.
FMCSA’S CLEARINGHOUSE
POSTS 650,000 REGISTRANTS
The Federal Motor Carrier Safety Administration (FMCSA) released
data following the first weeks of operation of its Commercial Driver’s
License Drug and Alcohol Clearinghouse revealing that the clearinghouse
has detected and identified nearly 8,000 positive substance-abuse tests of
commercial drivers since January 6. The clearinghouse now has more
than 650,000 registrants.
“We’ve seen encouraging results from the Drug and Alcohol
Clearinghouse, but there’s still work to do to ensure we identify more
drivers who should not be behind the wheel,” said FMCSA Acting
Administrator Jim Mullen. The clearinghouse is a positive step, and the
Agency continues to work closely with industry, law enforcement, and
our state partners to ensure its implementation is effective.”
The clearinghouse is aimed at improving road safety by providing
FMCSA and employers with the necessary tools to identify drivers who
have violated federal drug-and-alcohol-testing program requirements
and are prohibited from operating a commercial motor vehicle. The goal
of the clearinghouse is to ensure that such drivers receive the required
evaluation and treatment before they have the opportunity to resume
driving.
“The numbers of positive results did not surprise me,” said Truckload
Carriers Association Vice President of Government Affairs David Heller.
“Over time, the clearinghouse will shake out the abusers. We have to
remember that trucking is a safety-sensitive industry and is no place for
substance abusers.”
Those required to register for the clearinghouse include:
• Employers of commercial driver’s license (CDL) and commercial
learner’s permit (CLP) holders, or their designated service agents, and
medical review officers who report drug-and-alcohol-program violations
that occurred on or after Jan. 6, 2020;
• Employers or their designated service agents who conduct required
queries that inform them whether prospective or current employees have
drug and alcohol program violations in their clearinghouse records.
Employers must purchase a query plan before conducting queries in
the clearinghouse. Query plans must be purchased from the FMCSA
Clearinghouse website only;
TCA 2020 www.Truckload.org | TRUCKLOAD AUTHORITY 9