- On Wednesday, AB5, a new California law that makes it significantly harder to classify workers as independent contractors, went into effect.
- On Tuesday evening, however, a federal judge issued a last-minute order temporarily preventing the law from applying to independent truck drivers.
- The California Trucking Association filed a lawsuit in November saying AB5 violates federal law and “threatens the livelihood of more than 70,000 independent truckers.”
- A hearing is scheduled for January 13, at which the court will hear arguments for whether those truckers should remain exempt for the duration of the legal proceedings.
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In a last-minute order issued on Tuesday, a federal judge temporarily blocked California from enforcing its new gig-worker-classification law, Assembly Bill 5, against independent truck drivers.
AB5, which makes it significantly harder for companies to classify workers as independent contractors, went into effect on Wednesday. But on Tuesday evening, US District Judge Roger Benitez issued a temporary restraining order that prevents the state from enforcing the law against “owner-operators,” or independent truck drivers.
In November, the California Trucking Association filed a lawsuit in the US District Court for the Southern District of California asking the court to declare independent truck drivers exempt from the law.
“AB 5 threatens the livelihood of more than 70,000 independent truckers,” CTA CEO Shawn Yadon said in a statement at the time, adding “the bill wrongfully restricts their ability to provide services as owner-operators and, therefore, runs afoul of federal law.”
Benitez said in Tuesday’s order that emergency relief was justified as the CTA had shown that “(1) that they are likely to succeed on the merits, (2) likely to suffer irreparable harm in the absence of relief, (3) that the balance of equities tips in their favour, and (4) that their requested relief is in the public interest.”
A hearing is scheduled for January 13, at which the court will hear arguments from both sides over whether the temporary exemption should continue for the duration of the legal proceedings.
AB5, which was introduced largely in response to the rise of gig-economy companies that rely heavily on independent contractors, has spurred a heated debate in the state and could have a major effect on how those businesses operate. Uber and Postmates filed a lawsuit on Monday seeking to invalidate the law, and Uber has previously argued that the law doesn’t apply to its drivers.
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