A coalition of transportation and business interests has asked California lawmakers to defeat a legislative proposal that would classify all drayage truck operators serving the state's ports as employees of the company that arranges for or engages their services.
In a May 3 letter to the legislature's Assembly Labor & Employment Committee, the group, which includes the National Retail Federation, the shipper group NASSTRAC, the California Trucking Association, and the International Warehouse Logistics Association, said the legislation—AB 950—would effectively ban all owner-operators from serving California ports.
In the letter, the group argued that independent drivers provide the "capacity and flexibility" needed for companies to manage the dynamic demands of port drayage. Container activity at California ports can fluctuate as much as 30 percent during a given year, depending on prevailing economic conditions, the group said.
"To impose an employee drive mandate on the companies who arrange for drayage services is simply not consistent with reality of port activity and places California ports at another financial disadvantage to other North American ports," the letter said.
The bill, introduced last February by Assembly Speaker John Perez and Assembly Member Sandre Swanson, would classify owner-operators serving California ports and intermodal rail yards as employees of the trucking firms that engage their services. Federal antitrust laws bar unions from organizing independent contractors such as owner-operators. Labor interests, notably the Teamster union, argue that trucking firms already control enough of the owner-operators' daily activities to constitute an employer-employee relationship, thus making it legal for drivers to be organized by unions.
The bill's opponents warned that passage and signature of AB 950 would worsen an expected shortage of draymen and drive up operating costs at the ports of Los Angeles and Long Beach. The group cited a report by the Boston Consulting Group that projected the employee mandate would result in a $500 million annual increase in drayage costs and result in the loss of California jobs to ports in other states.