California AB5 is making headlines once again after news that the California Trucking Association’s (CTA) injunction was overturned earlier in 2021. The trucking industry, specifically in California, is facing a challenge that may put business owners out of business and will further disrupt the supply chain delay caused by the pandemic.
Despite the overturned injunction, the CTA plans to file a petition to the Supreme Court. Discover what this means for trucking and get a rundown of details on the latest news and why the CTA is petitioning an appeal.
Why is AB5 Important to Trucking?
California’s Assembly Bill 5 puts the trucking industry at risk of low labor and a delayed supply chain network. Most Californian trucking companies hire drivers as independent contractors, to work jobs that deliver goods all across the country. This change could spell disaster not just for trucking, but for everyone with supply chain connections.
At the heart of the pandemic when the economy needed to be stimulated, the trucking industry showed quick signs of recovery despite AB5. This sector is essential to the economy thriving. With the current status of delayed materials rippled from the shutdown, it’s not clear what the future will look like for trucking if independent drivers are ousted from working – and what it means for trucking companies. You can read more about how AB5 affects California business owners in our previous article.
Related Article: California AB5: Overturned Law Puts The Trucking Industry at Risk
Who is Petitioning the Assembly Bill 5?
The California Trucking Association (CTA) is the organization seeking to petition to the Supreme Court. Below is their position and role in the California trucking industry:
“The largest trucking trade association in the state of California that dedicates itself to promoting advocacy, safety, compliance and leadership in the trucking industry. Located in the Capitol, CTA provides its members with access, influence and protection through many resources that advance the long-term sustainable profitability of our motor carriers and suppliers in the trucking industry. CTA provides legislative and regulatory representation, leadership development and education.”
Petition to Appeal California AB5
In April of 2021, a panel of three judges from the Ninth Circuit Court of Appeals voted 2-1 to remove the injunction on AB5. Following the decision, the CTA filed a petition to have the case heard by all the judges in the court, also known as an en banc rehearing, to vote again in May. As of June 2021, the court has denied the rehearing petition.
Shawn Yadon, CEO of the California Trucking Association, stated:
“While the decision by the Ninth Circuit to deny an en banc rehearing is disappointing, we are committed to continuing our efforts to protect California’s 70,000 independent truckers. Enforcing AB5 would throw the nation’s supply chain into further chaos and destroy the livelihoods of thousands of blue collar entrepreneurs.” Source: Land Line Media
The California Trucking Association plans to petition to take the case to the Supreme Court in hopes that they will consider the case.
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