"It’s not a good vibe right now," said Raman Dhillon, CEO of the California-headquartered North American Punjabi Trucking Association. He was talking about his group's membership's response to the news last week that a three-judge panel of the Ninth Circuit Court of Appeals had struck down a lower court's injunction against application of California's A.B. 5 contractor law and its ABC test's application to trucking.
The original suit that was ruled on had been brought by the California Trucking Association, who told Overdrive it is planning to request what's known as an en banc review, a reconsideration from the entire panel of judges in the Ninth Circuit. As previously reported, from the April 28 ruling on the injunction, CTA has 14 days to seek rehearing. If that request is denied or if the rehearing fails to change the view of the court, it will be a mere seven days from the denial or failure before the injunction lifts.
"The community is scared right now of what’s going to happen," said Dhillon about his organization's membership, who nonetheless remained in wait-and-see mode. "We have about 70,000 owner-operators in California," a bulk figure cited by the CTA attendant to their litigation. "There’s a big chunk of them who are Punjabi" and members of Dhillon's group. He estimated as many as half of the state's owner-operators could be from the Punjabi-American community. Many are leased, furthermore, and it's in those traditional, exclusive-lease relationships between carriers and owner-operators that A.B. 5 poses the greatest threat to what are otherwise legitimate, long-federally-recognized business relationships.
[Related: Trucking law -- your rights under the Truth in Leasing regulations]
It's not just California carriers or state-domiciled owner-operators that are in the crosshairs of the ABC test's B prong, requiring carriers and contractors to be in essentially separate areas of business. As the Owner-Operator Independent Drivers Association put it in its brief filed with the Ninth Circuit, in support of the injunction remaining in place, "for tens of thousands of interstate owner-operators and small-business motor carriers that regularly cross the California border — small-business truckers critical to the interstate motor carrier industry —AB 5 could be fatal."
Transportation attorney Greg Feary of the Scopelitis, Garvin, Light, Hanson and Feary firm notes jurisdiction depends on many factors, but could extend to any worker that has "enough operational nexus with the state of California to be subject to its jurisdiction under AB 5." The enough part of that has been the subject of past litigation, he added, and court rulings. "Certainly, contractors whose business is domiciled in California and work picking up loads in the state have enough to be considered a California worker."
What if 40% percent of your loads pick up in California, but the other 60% are in Nevada? "It could be that Nevada has a greater interest in applying their employment laws than California" but that determination will only ever be made in any state on a case by case basis with a close look at the facts.
