The injunction that prevented California’s independent contractor statute, AB5, from being implemented in the state’s trucking industry has been lifted.
Federal District Court Judge Robert Benitez formally removed the injunction that has been in effect since New Year’s Eve 2019, according to a statement posted by trucking-focused law firm Scopelitis, Garvin, Light, Hanson & Feary. The court’s ruling file was not accessible online at the time of publishing.
The impending lifting of the injunction brings into effect an April 2021 U.S. 9th Circuit Court of Appeals judgment that overturned Benitez’s original order. The appellate court decision overturning the Benitez injunction permitted the injunction to remain in place while the California Trucking Association, which filed the original action in the case, appealed to the United States Supreme Court.
When the Supreme Court declined to hear California Trucking Association v. Bonta, the matter was returned to the appellate court. That court, in turn, issued a mandate to the district court, directing the injunction to be lifted. That move was formalized by the action on Monday.
However, the case is not over. The CTA’s legal claims, that AB5 as applied to trucking in California breaches provisions of the Federal Aviation Administration Authorization Act, were only made through motions on the injunction, rather than a full judicial proceeding. The CTA has decided to restart the case and has requested a new injunction. On Monday, none were forthcoming.
According to the Scopelitis report, Benitez invalidated an earlier Benitez order that denied a CTA argument involving AB5 and the Dormant Commerce Clause, which affects interstate commerce. The Owner-Operator Independent Drivers Association (OOIDA) has yet to decide if it can interfere in the case.
According to a previous court filing, the next stage is the filing of briefs in the lawsuit, which could take place as early as December.
To determine whether workers are independent contractors or employees, AB5 requires them to be examined on the provisions of the so-called ABC test. The so-called B prong, in particular for trucking, is problematic because it states that an independent contractor must be involved in “activity that is beyond the regular course of the hiring entity’s business.” A trucking company that hires an outside truck driver risks being found in violation of the B prong.
The verdict prompted an immediate media outreach from a public relations firm, which provided comments from the union side of the ledger.
“Today, drivers across California can rest easy knowing that trucking businesses that have gotten away with misclassifying workers may no longer exploit their workers or the people of California to enhance their bottom line,” according to an email from Teamsters public relations firm Berlin Rosen. “These corporations will be held accountable, and drivers’ rights will be protected by the law.”
