Supply chain problems have been negatively impacting California and the rest of the nation for months. Look at any new car lot and you see the lack of inventory. Even buying products at the store is difficult. A big part of the problem has been the backup caused by the lack of trucks to move products from the ports to markets and consumers throughout the United States. Now the problem may become much worse.
In 2019, the Legislature pushed through AB 5, in my view one of the most devastating laws to impact business in California’s recent history. The bill was an ill-conceived attempt to deal with the problem of employee misclassification. Instead, it jeopardized the livelihood and security of thousands, including independent truckers. The California Trucking Association sued to block implementation, and the law was not being enforced against truckers pending a potential ruling from the U.S. Supreme Court. Unfortunately, on June 30th, the Court refused to hear the Trucking Association’s lawsuit, and enforcement will begin.
40 percent of the nation’s products move through California’s ports, and much of that is transported by independent “owner-operator” truckers. There are approximately 500,000 owner-operators nationwide, and about 70,000 of those operate in California. Additional new regulations and insurance costs mandated by AB 5 could cost each trucker up to $20,000 per year, driving many out of business, costing jobs, driving up consumer prices and worsening supply chain problems.
I have joined my caucus colleagues in a letter to Governor Newsom asking that he use his executive authority to either delay implementation of AB 5 or to exempt the trucking industry altogether. To view the letter, please visit: https://asmrc.org/wp-content/uploads/2022/07/Letter-to-Newsom-AB-5-7.5.22.pdf
Without immediate relief for truckers, jobs will be lost, inflation will worsen, and the supply chain crisis will worsen. The Governor must take action now.