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California District Court Dismisses Trucking Industry’s New AB5 Challenge

08 May

Update Applicable to:Effective date
All employers in the trucking business and multi-state trucking business in CaliforniaSee details below

What happened?

On March 15, 2024, the United States District Court for the Southern District of California dismissed the trucking industry’s long-pending case challenging the statute (AB5), which aimed to stop the state from applying strict independent contractor rules to truckers.

What are the details?

The trucking industry will continue to be governed by AB5, following the U.S. Supreme Court’s decision not to review the matter in June 2022. AB5 establishes a strict “ABC” test to classify a worker as an employee or an independent contractor.

Given that AB5 has been operational for more than four years and has applied to the trucking industry since 2022, many conscientious motor carriers in California have already transitioned to alternative business models that adhere to AB5.

The dismissal of the case was conducted by the same judge who issued the initial injunction.

Business Considerations

  • Employers may consider conducting an audit of their workforce to ensure no one is misclassified.

Source References


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