Nearly 100 owner-operators protested in downtown Los Angeles on Thursday after receiving letters in late May stating town was ending their contracts for its As-Needed Haul Truck Program, citing the independent contractor law AB5.
Assembly Bill 5 — which requires firms to make use of a three-pronged ABC test to find out whether a driver is an worker or independent contractor — continues to face legal challenges after the U.S. Supreme Court denied a petition from the California Trucking Association to listen to the case in June 2022.
Victor Vasquez Sr. is one among the independent truckers who protested the choice by town’s Department of Public Works to finish its 130-year-old program to haul paving and resurfacing materials. He said the move by town could have a devastating impact.
“We have now some families which have five generations of truckers who take part in this program,” Vasquez told FreightWaves. “Lots of us spent hundreds of dollars to upgrade our equipment to make sure that we complied with the brand new regulations that took effect in January.”
The extensive list of necessities to take part in town’s hauling program, which consists of greater than 87% of minority-owned owner-operators and receives hundreds of thousands of dollars in federal funding, was faraway from town’s website early Thursday.
Vasquez, who serves because the president of the Los Angeles City Contract Truck Association and as a board member of the Western States Trucking Association (WSTA), said many independent truckers now have steep truck payments to comply with the California Air Resources Board (CARB) Truck and Bus rule that required them to incorporate 2010 model 12 months or newer diesel engines by the top of last 12 months.
While this was a one-day protest, Vasquez said his group plans to satisfy again soon to make a decision its next steps.
“I even have a 2020 truck and pay $3,000 per 30 days, while some have 2023 trucks and are paying as much as $5,300 per 30 days,” Vasquez said. “We complied and regarded this an investment because, after 132 years, how could they possibly eliminate us? But that’s what they intend to do.”
In a letter to owner-operators, which was reviewed by FreightWaves, Keith Mozee, executive director and general manager of the Bureau of Street Services, often known as StreetsLA, said the California Department of Industrial Relations “has indicated that the brand new ABC test applies to public entities reminiscent of town.”
Mozee invited the owner-operators to take part in the City of Los Angeles Department of Public Works Profession Fair on June 29, the letter states.
In an announcement, town’s Department of Public Works said it cares “very much concerning the livelihoods of our partners and have been working aggressively on the direction of the Mayor [Karen Bass] to be sure that our 93 contract truck drivers are given the chance for city employment and that operations proceed seamlessly.”
Joe Rajkovacz, WSTA director of governmental affairs, said there isn’t a mention of what happens to the equipment the owner-operators purchased to comply with town’s hauling program and CARB.
“Is town going to satisfy their mortgages on the trucks and trailers they own? No. City employment is virtually a nonstarter for these owner-ops since it means bankruptcy,” Rajkovacz said. Given market conditions, “many would take a shower financially in the event that they tried to sell” their used trucks.
He said town would pass all three prongs of the ABC test in the event that they had told “owner-operators to include and develop into employees of their company if there was really a priority.”
Some participants said they could develop into homeless if town proceeds with the move to finish the contract hauling program because they used their homes as collateral to finance newer equipment to satisfy town’s requirements and CARB regulations.
Even in the event that they are offered employment with town, Vasquez said it won’t be enough to cover their equipment payments.
Vasquez said since Southern California sustained record-level flooding this 12 months, the services the hauling program provides are badly needed.
“The town’s streets are in bad shape with potholes in all places, and we all know the routes and know what is required,” he said. “Lots of us have worked across the clock to be available when needed, and that is how we’re repaid. If we had known town planned to chop ties with us, a lot of us wouldn’t have gone out and purchased these newer trucks when our old trucks were paid off.”
Do you’ve gotten a news tip to share? Send me an email or message me @cage_writer on Twitter. Your name won’t be used without your permission.
Read more here:
2 former employees charged with bilking $1.4M from carrier MH Group
Former Slync CEO indicted on charges of swindling $25M from investors
Feds charge former Slync CEO in $67 million fraud scheme
Way forward for Supply Chain
JUNE 21-22, 2023 • CLEVELAND, OH • IN-PERSON EVENT
The best minds within the transportation, logistics and provide chain industries will share insights, predict future trends and showcase emerging technology the FreightWaves way–with engaging discussions, rapid-fire demos, interactive sponsor kiosks and more.
