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California Trucking Association, two owner-operators seek relief from California AB5

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California Trucking Association CEO Shawn Yadon said AB 5 threatens the livelihood of more than 70,000 independent truckers and that the bill wrongfully restricts their ability to provide services as owner-operators and, therefore, runs afoul of federal law. (©2019 FOTOSEARCH

SACRAMENTO — The California Trucking Association (CTA) and two California independent owner-operator truck drivers Tuesday filed an amended complaint with the U.S. Southern District Court seeking declaratory and injunctive relief against the employment test set forth in the Dynamex Operations West, Inc. v. Superior Court (Dynamex) decision, which was subsequently codified by the California Legislature in the form of Assembly Bill 5 (AB 5).

AB 5 was passed by the California Legislature and signed into law on September 11 by Gov. Gavin Newsom.

“AB 5 threatens the livelihood of more than 70,000 independent truckers,” said CTA CEO Shawn Yadon. “The bill wrongfully restricts their ability to provide services as owner-operators and, therefore, runs afoul of federal law.”

In the suit, plaintiffs argue that the classification test in the Dynamex decision and codified by AB 5 is preempted by the supremacy and commerce clauses in the U.S. Constitution and is in direct conflict with the Federal Motor Carrier Safety Act (FMCSA) and the Federal Aviation Administration Authorization Act of 1994 (FAAAA).

The CTA said the new test denies a significant segment of the trucking industry the ability to continue operating as independent owner-operators in California, forcing them to abandon $150,000 investments in clean trucks and the right to set their own schedule and become their own boss.

AB 5, rather than addressing the issue of employee misclassification for all California workers, replaced a longstanding multi-factor test for determining independent contractor status with a one-size-fits-all method, consisting of highly restrictive criteria, riddled with carve-outs and exemptions for specific businesses and industries. Under the new test, independent truckers will be forced to work as employees.

Meanwhile, the International Brotherhood of Teamsters reiterated its support for AB5.

“For decades, companies like Lowe’s, Rio Tinto Mines and Target have enjoyed unprecedented profitability and shareholder value off the backs of the hardworking truck drivers who haul their imported cargo from our nation’s seaports to their warehouses,” said Fred Potter, vice president at large of the Teamsters, who is director of the union’s port division. “It’s no surprise that their trucking contractors are going to court to perpetuate a scheme – deemed illegal by multiple regulatory agencies and courts long before Assembly Bill 5 was introduced in the California Legislature – that has robbed the typical driver of tens of thousands of dollars a year due to their misclassification as independent contractors. The gig is up and it’s time for the drayage industry to comply with local, state, and federal laws or risk being kicked out of the ports altogether, and it’s time for the cargo owners  — America’s largest retailers  to stop doing business with recidivist lawbreakers.”

Robert R. Roginson, an attorney for the CTA, said AB 5 has implications that go beyond employment classification in California.

“With more than 350,000 independent owner-operators registered in the United States, the new test imposes an impermissible burden on interstate commerce under the U.S. Constitution’s commerce clause and infringes upon decades-old congressional intent to prevent states from regulating the rates, routes and services of the trucking industry,” he said.

The CTA said for decades in California, more than 70,000 predominantly minority-owned truckers have built their businesses as independent owner-operators. These truckers have just recently invested hundreds of thousands of dollars in their vehicles to meet the nation’s strictest air quality laws.

“Independent truckers are typically experienced drivers who have previously worked as employees and have, by choice, struck out on their own. We should not deprive them of that choice. Some of the country’s most successful trucking companies were started by entrepreneurial independent truckers,” Yadon said. “We can protect workers from misclassification without infringing upon independent truckers’ right to make a living in California.”

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The Truck Boss Show – Liability Insurance Insight

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Truck Boss team talks about how truckers are giving for the holidays, cargo theft statistics, liability insurance changes and teams up with the guys of Speed Garage for a cab replacement.

Courtesy: The Truck Boss Show 

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Dart Transit names Dave Ables as new president & CEO

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Dave Ables brings 25 years of transportation experience to his new position at Dart, serving in executive leadership positions for the past six years with truckload carrier PAM Transport. Prior to his appointment with Dart, Ables was vice president of operations & marketing for all 13 operating divisions at PAM Transport. (Courtesy: DART TRANSIT CO.)

EAGAN, Minn. — Dart Transit Co., in its 85th year as a nationwide transportation service provider, has appointment of Dave Ables as the company’s new president and CEO. Chosen through an extensive national search process that was overseen by Dart Chairman Donald G. Oren, Ables will be responsible for directing the day-to-day operations of Dart. He will lead Dart’s management team, and report directly to Oren, who will continue his daily involvement in the overall operation of the company that the Oren family has owned since its founding in 1934.

Ables brings 25 years of transportation experience to his new position at Dart, serving in executive leadership positions for the past six years with truckload carrier PAM Transport. Prior to his appointment with Dart, Ables was vice president of operations & marketing for all 13 operating divisions at PAM Transport.

“We focused our search on finding an executive leader with the right depth and breadth of experience within all of Dart’s markets and facets,” Oren said. “In Dave Ables, we found the right person who possesses the full range of skills and values needed to continue to move our organization forward. Over his career in transportation, Dave has established an impressive track record of success, and I am confident that Dave will bring valuable insights and innovative approaches that will benefit our entire organization and all our customers. In reviewing his experience and during the interview process, we were particularly impressed with the leadership Dave has exhibited within the truckload market, and his ability to work well with employees, owner-operators, customers and the community alike. In our view, he has the right mix of experience working with all aspects of operations, customer service and sales, and he will be a high-quality leader for Dart.”

In addition to his time with PAM, Ables held truckload leadership positions with other major carriers including Barr-Nunn, CRST and Stevens Transport. Oren and the Dart management team also took note of Ables’ prior experience in other key areas of business currently offered through the Dart Network. In serving as the Retail Supply Chain Practice Leader for Ohio’s Global Executive Solutions, Ables oversaw strategic sourcing, global purchasing, network optimization and a variety of logistics functions. Outside of trucking, Ables has been the managing member of his family-owned hardware store as well as other small businesses.

“Dave’s expertise in logistics and supply chain solutions, along with his experience as a business owner and entrepreneur, will serve him well as the president and CEO of our company,” Oren said  “Between his wide range of career experience and the insights he shared with us, we found that Dave is an ideal fit for Dart and its variety of services, including logistics and intermodal services.

“My wife Bev and I, along with our children, David, Daniel, Bradley and Angela, are very proud of what we’ve built together at Dart, and we couldn’t be more excited to bring Dave Ables in to be Dart Transit’s president and CEO and next successful leader,”  Oren said. “We are looking forward to working with Dave in the years ahead as our entire organization stays focused on being the best service provider in the business for drivers, owner-operators, employees, technicians and customers alike.”

Ables and his wife, Lori, both have family ties to the Midwest, growing up in Iowa where Ables attended the University of Northern Iowa. They are the parents of three sons, David, Samuel and Nicholas.

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FTR, ACT Research report disappointing November Class 8 order results

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Tim Denoyer, ACT’s vice president and senior analyst, said the freight market downturn worsened in the past month and uncertainty surrounding trade and tariffs continue to weigh on truck buyers’ psyches. (Courtesy: ACT RESEARCH)

The two companies known for their collection and analysis of trucking industry information reported a drop in Class 8 orders.

FTR reported preliminary North American Class 8 orders for November at a “disappointing 17,300 units, down 21% from October.” It was the lowest November total since 2015 and was 39% lower than the same month a year ago, FTR said.

ACT Research noted that North American Class 8 orders failed to sustain momentum created in October.

ACT Research Preliminary North America Class 8 net order data show the industry booked 17,500 units in November, down 20% from October,

FTR said fleets remained extremely cautious heading into 2020, placing small orders and not extending orders much beyond the first quarter.  A couple OEMs reported decent order activity, but total orders fell below expectations. Class 8 orders for the past 12 months have now totaled 180,000 units.

“The fall order season has gotten off to a slow start. Freight growth has stalled from the high rates of last year,” said Don Ake, vice president commercial vehicles. “This is causing fleets to be much more measured in their ordering for 2020. There still will be plenty of freight to haul, so we expect fleets will continue to be profitable and to replace older equipment. However, there won’t be a need for much additional equipment on the roads.”

Ake said there was still a great deal of uncertainty in the environment which is creating apprehension in the trucking industry. Manufacturing has receded for four straight months, slowing economic growth. The trade war and tariffs are destabilizing prices and supply chains. And the tumultuous political climate just adds to an uneasy mix. The industry thrives on stability, but we are now on a rocky road.”

Tim Denoyer, ACT’s vice president and senior analyst, said the freight market downturn worsened in the past month and uncertainty surrounding trade and tariffs continue to weigh on truck buyers’ psyches.

“With rising pressure on carrier profits from the combined impact of lower rates and the recent, rather sudden jump in insurance premia, recent events have not developed in the industry’s favor,” Denoyer said. “While private fleets continue to add capacity on the retail end, the market is increasingly heeding for-hire price signals and the stage is being set to right-size the fleet, bringing it closer to equilibrium with the work to be done.”

For more information on FTR, visit www.ftrintel.com.

For more information on ACT Research visit www.actresearch.net.

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