What AB5 Means for Trucking Carriers
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AB5 Has Arrived
AB5 is here, and it is here to stay. The California law changes the way in which workers are classified as either employees or independent contractors, affecting the relationship between trucking carriers and their independent contractor drivers. After the Supreme Court ruling, AB5 is officially law and like we said when AB5 was ratified two years ago, this will have a big impact on how the trucking community operates in California.
Whether a trucker is now classified as an employee or an independent contractor for the company it works with depends on the ABC test. If the relationship between a worker and company fails any of the three conditions of the ABC test, then they would have to be considered an employee of the company and not an independent contractor. With these new regulations, many trucking companies would be required to classify independent contractor truckers as employees.
What does AB5 mean for the California trucking industry?
For starters, many larger carriers that use independent contractors as their drivers will have to either bring them on as employees or stop working with them. This could cause many carriers to fold, and cause a surplus of single-truck operators looking for work. The way for truck drivers to go out on their own is by being an owner operator, and the way to become one starts with obtaining operating authority.
Since DrayNow is a load board app connecting owner operators with intermodal freight, we are not affected by the AB5 decision. Carriers freely choose the freight that they want to haul. For any independent contractors that are looking to go out on their own as an owner operator, the DrayNow app can be a great way to find local intermodal loads.
Navigating the current trucking industry with these new rules in place is going to be tricky. At DrayNow, we want to be a resource as you independently enter the market for the first time. Check out our blog for more resources and download the free app to find local intermodal freight to grow your business.
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