150 Truckers Protest California’s Independent Contractor “Misclassification” Bill
Sacramento, CA – Independent owner-operators in California converged on the state Capitol on Thursday to fight for their rights to remain in business.
More than 150 independent owner-operators from around California convoyed in Sacramento to protest proposed legislation known as Assembly Bill 5, otherwise known as AB5.
Independent contractors from various industries (such as trucking, construction, medicine, entertainment, janitorial, beauty, etc.) would be among an estimated one million Californians who would be affected by the new legislation if passed into law.
The California Trucking Association (CTA) says 70,000 of those individuals are independent owner-operators in the trucking industry.
Lawmakers are selling the proposed legislation to constituents as a fight against income inequality.
However, opponents of AB5 widely argue the bill, if passed, would eliminate the ability to make a living performing tasks as “non-employees.”
In trucking specifically, critics say AB5 would require many independent owner-operators to become employees under larger companies.
In a press release on Thursday, CTA said they have been hard at work with the bill’s author, Assemblywoman Lorena Gonzalez, and other legislators to provide a fix to AB5 that would protect employees from misclassification without eliminating the independent owner-operator business model.
“I think in the end we’re going to come up with an opportunity for truckers to either be employees or truly small businesses,” Gonzalez said. “But we are not going to give a carveout to an industry that has systematically and continually misclassified workers.”
“These truckers are here [in Sacramento] because AB5 would deny a significant segment of the trucking industry the ability to continue operating as independent owner-operators, forcing them to abandon investments they’ve made in their trucks while taking away their flexibility to set their own schedule and determine the destiny of their business,” CTA’s CEO, Shawn Yadon, said following Thursday’s convoy.
“This is a story about businessmen and businesswomen, who made a decision, in many cases 10, 15, 20 years ago or more, to invest well over $100,000 of their money into a truck and start their own business as an independent owner-operator, not an employee driver,” Yadon continued.
Yadon also asserted that while CTA supports “clear definitions of who can and cannot be classified as an independent contractor in order to avoid abuses in the workplace,” AB5 does not take into consideration more than 70,000 truckers in California who have built their businesses around the independent contractor model.
“Independent truck drivers represent a vital and successful segment of the trucking industry and Sacramento should be encouraging this entrepreneurial spirit, not destroying their livelihood,” Yadon said.
The California Truckers Guild, a non-profit organization that “represents hundreds of independent businesspersons who own and operate their trucks and are hired individually by construction and agriculture companies in the state,” supported the convoy, according to its Facebook page.
A video posted to social media by the Guild shows trucks driving by the Capitol, honking their horns as passersby watch on.
AB5 is expected to pass both houses of the Legislature before lawmakers adjourn on September 13.
If that happens, a spokesperson for California governor Gavin Newson said he is “supportive of addressing the misclassification of workers, which for decades has been a driver of income inequality.”
Perhaps the enthusiasm for Governor Newsom to sign AB5 into law is that California is estimated to lose $7 billion a year in payroll taxes due to how independent contractors are paid.
Additionally, companies do not pay Social Security or Medicare taxes on independent contractors, adding on to potential revenue to the State.