With some in the trucking industry pushing for changes to the time truck drivers are legally permitted to spend behind the wheel, the Federal Motor Carrier Safety Administration recently announced propose changes to address this desire.
The effort to define who is an employee and who is an independent contractor has been an ongoing battle in California, particularly since the Dynamex decision that came down from the California Supreme Court last April. While the full impact of the decision in the courts is still being seen, it is no surprise that the issue is now being taken up by California's legislative branch as well.
As discussed here, the Federal Motor Carrier Safety Administration ("FMCSA") has set up its own rules for rest breaks for safety purposes that pre-empt those of the states. That became very clear when the FMCSA issued its determination that federal regulations pre-empted California's meal and rest break rules. However, as the challenges to the FMCSA pre-emption determinatin winds its way through the courts, the House of Representatives wants to step in to handle the situation.
As discussed on this blog, late last year the Federal Motor Carrier Safety Administration ("FMCSA") determined that California's Meal and Rest Break rules are pre-empted by federal law, as applied to property-carrying commercial motor vehicle drivers covered by the FMCSA's Hours of Service regulations. Less than five months later, the implications of this are being seen in court.
As discussed previously on this blog, the transportation market is rapidly evolving both in terms of the laws governing it and in the nature of the business itself. Now, FedEx is looking to bring the next innovation along as it announced plans for last-minute robot delivery for companies such as Pizza Hut and Walmart.
In California, the ongoing litigation around the definition of an employee versus independent contractor and the rules for meal and rest breaks threaten to upend the trucking industry. While these issues are understandably garnering significant attention, there are others across the country that could also have a large impact. Currently, a case in Arkansas may leave the industry forced to undergo massive change.
In a recent Federal Arbitration Act ("FAA") decision, the United States Supreme Court unanimously made getting to arbitration more difficult for trucking companies. In Oliveira v. New Prime, the Supreme Court determined that it was for a court, not an arbitrator, to decide if the exemption in Section 1 of the FAA applies. More importantly for truckers, the Court decided that the Section 1 exemption applied to all truck drivers, whether employees or independent contractors. This means the FAA cannot be used to compel arbitration of claims involving truck drivers.
As discussed previously on this blog, recent legal developments have complicated the business plans of trucking companies that use independent contractors as drivers. These have included the Dynamex decision that changed the 30-year-old test of whether a worker is an employee or an independent contractor, but appears applicable only in certain circumstances and for only certain legal claims. This was followed by lawsuits to invalidate Dynamex and a federal district court decision finding that Dynamex was pre-empted by federal law. Compounding this confusion, California passed a law late last year that exposed large retailers to new potential liability. The bill, SB 1402, meant companies could be jointly liable when they hire companies that have violated state employment laws. Now shippers could be liable for violations caused by the motor carriers they hire.
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.