As discussed previously on this blog, the Dynamex Operations West v. Superior Court decision upended California's independent contractor market with a new test for whether a worker will be considered an employee. The new test was particularly problematic for the trucking industry. As such, several cases have arisen to challenge the Dynamex decision. The Western States Trucking Association (WTSA) challenged the case. Additionally, a recent California District Court decision determined federal law pre-empts Dynamex. Of course, there is a still a long way to go before Dynamex's fate is decided.
Along with these challenges, the California Trucking Association (CTA) has also launched its own challenge to Dynamex. The CTA filed an action on October 25, 2018. Similar to the WTSA challenge, the CTA argues Dynamex is pre-empted by federal law, namely the Federal Aviation Administration Authorization Act (FAAAA) and the Commerce Clause of the United States Constitution.
The CTA's claim targets prong B of the new test, which requires "that the worker performs work that is outside the usual course of the hiring entity's business" to be considered an independent contractor rather than an employee. The CTA argues the new test directly affects the services, routes, and prices of the CTA's members, which is covered by the FAAAA.
The CTA's commerce clause argument focuses on the claim that the new test is an unreasonable burden on interstate commerce. The CTA plans to seek a preliminary injunction to halt application of the Dynamex ABC Test.
The CTA's action in many ways attacks Dynamex with arguments similar to those made by the WTSA. Both organizations seek to prevent a large-scale upheaval to the trucking industry, as the Dynamex test could lead to all owner-operator truck drivers being treated as employees rather than independent contractors.
Even with both the CTA and WSTA cases pending and the Central District court case already finding Dynamex pre-empted by the FAAAA, the fate of the ABC Test remains unclear. And, even if Dynamex is pre-empted, motor carriers using owner-operators in California must still meet the Borello test for worker classification. In all, the transportation industry remains under a lot of pressure regarding worker classification and experienced transportation and employment counsel can make a real difference in getting it right.