A district court in San Diego has issued a temporary injunction to prevent enforcement of California’s recent AB 5 law for the trucking industry. This injunction does not affect other industries and all other employers are still expected to comply with the state’s “ABC test” for employee classification.
California Trucking Assoc. v. Becerra
In a lawsuit brought against the state of California, the California Truckers Association (CTA) asserted that the recently enacted bill AB 5 would reclassify most drivers as employees. The CTA argued that most truck drivers it represents would prefer to retain their independent contractor classification, which allows them to set their own schedules and profit from owning their own vehicles. The CTA also argued that AB 5 is preempted by a federal law that prohibits states from regulating the price, route or service of freight-hauling motor carriers.
The district court judge found that the CTA was likely to succeed in its case and likely to suffer irreparable damage if relief was not granted, and that the request for a temporary injunction was in the public interest. A hearing on this matter is scheduled for Jan. 13, 2020.
While the CTA case is not the only case that has been filed against California’s AB 5, this case is the only one that has succeeded against enforcement of the new law.
Sept. 18, 2019
AB 5 becomes law and sets the “ABC test” as the new standard to determine employment status.
Dec. 31, 2019
Federal district court issues temporary injunction against the enforcement of AB 5 in the trucking industry.
Jan. 1, 2020
Effective date for AB 5 across the state of California.
We will continue to monitor challenges to this law and provide updates as new developments take place. Employers should continue to review their employee status classification practices to ensure compliance with federal, state and local laws.
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