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Understanding Trucking Regulations and How They Are Affecting Your Business Life

Updated: May 12




The remainder of 2022 is likely to be significant for trucking regulations and requirements due to factors such as the current pandemic and changing political landscape. Collectively, these factors can play a role in the development of future trucking regulations, which will affect various aspects of the industry.


ASSEMBLY BILL 5 (AB5) & PROTECTION FOR INDEPENDENT CONTRACTORS

AB5 was adopted by the State of California in 2020, and made significant changes to the classification of workers in an enterprise, assuming that all workers are employees. For a worker to be considered a self-employed contractor, the hiring corporation must demonstrate that the worker meets the following conditions:

· The employee is free to control and direct the provision of services; and.

· The worker performs work outside the normal course of business of the hiring corporation; and.

· The worker is usually engaged in an independent trade, occupation or enterprise.

Condition B is the largest obstacle to trucking companies who have traditionally relied on independent contractors, as it will be very difficult to show that contracted truck drivers are performing work outside of the usual course of company business. As a result of these challenges, there are currently two court cases initiated by the California Trucking Association (CTA) and Cal Cartage, and the United States. The California District Court issued an AB5 restraining order to be applied to the trucking industry. This order will remain in effect until a permanent decision can be made, but it should be closely monitored as it could create a precedent for other states considering new trucking legislation.


MINIMUM WAGES

The minimum wage is definitely one of the hottest issues in employment law. Currently, 440 minimum wage bills have been introduced or passed since 2020. Changes to minimum wage can happen in the city, state, or federal level and employers should be paying close attention to conversations on all fronts in order to prepare for new legislation. Within trucking, this is most likely to impact fleets who employ local or short-haul drivers on an hourly pay schedule, although most regulations require long-haul drivers on per-mile schedules to make minimum wages as well.


BAN THE BOX & DISCLOSURE OF CRIMINAL CONVICTIONS

Prohibiting the box, or the Fair Chance Act, refers to the box on employment applications requiring disclosure of previous criminal convictions. The law technically prohibits employers from requesting or considering conviction history until a conditional offer has been made, and is intended to push background checks later into the hiring process so that employers consider candidates’ qualifications before their criminal history. Fleet managers should bear in mind that crime and drug and alcohol background checks are always mandatory and should be considered separately from other criminal convictions.


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