After four-and-a-half years of litigation, the California Trucking Association (CTA) has discontinued its efforts to have Assembly Bill 5 (AB 5) overturned in court. AB 5 is California state legislation which adopted the “ABC” test to determine employee classification.
The “B” prong of that test asks whether a worker “performs work that is outside the usual course of the hiring entity’s business.” For owner-operators in the trucking industry, that “B” prong usually classifies O/Os as employees, because driving a truck is part of an overlying motor carrier’s business.
CTA’s litigation effort has had its victories and losses, but now courts have ruled against CTA’s core legal arguments. The Owner-Operator Independent Drivers Association (OOIDA), which joined CTA in this legal battle, has vowed to continue the litigation.
Adopted by the California legislature in 2019, AB 5 became effective in 2020 but the state has yet to conduct any enforcement against California trucking. During the 2020 election, California voters adopted Proposition 22, which prohibited the state from enforcing AB 5 against workers in the gig economy.
As we start 2025, consider this a status report on rules that were implemented, rules that were proposed and are going through the rulemaking process and rules that are in limbo, mostly as agencies wait for guidance from the incoming Trump Administration.
The legal requirement to file Beneficial Ownership Information Reports (BOIRs) with FinCEN has been suspended by a court decision.
ICSA believes that carriers that operate safely should be rewarded and that FMCSA should offer real incentives for carriers to take steps to operate safely without the government mandating those steps.