REGION — Truckers and freelance writers have brought forward the first legal challenges against Assembly Bill 5, a bill signed into law in September by Gov. Gavin Newsom and authored by Assemblywoman Lorena Gonzalez (D-San Diego). The legislation aims to reshape the state’s economy by putting more restrictions around how employers use independent contractors in the aims of halting worker misclassification.
The federal lawsuits, filed on Nov. 12 by the California Trucking Association and on Dec. 17 by the American Society of Journalists and Authors and the National Press Photographers Association, offer the first glimpses of what the legal backlash against AB 5 could look like. Ride-sharing companies such as Uber, Lyft and Doordash — the principal targets of the law — have also already stated intentions to gather signatures and raise $90 million for a ballot initiative for the 2020 election year.
AB 5 is often described by Gonzalez as a codification of the California Supreme Court case Dynamex Operations West, Inc. v. Superior Court of Los Angeles. The Dynamex decision created a three-part test to determine if the employee was “free from the control and direction of the hiring entity” and “performs work that is outside the usual course of the hiring entity’s business.”
After its introduction early in 2019, Gonzalez’s bill went through multiple rounds of amendments and a host of industries won exemptions, including those in the freelance writing profession. Under the language which eventually passed, freelancers can turn in up to 35 “submissions” per year to their clients until being either made a part-time or full-time employee. The law also permits unlimited business-to-business contractual relationships.
But the independent contractor-based trucking industry did not land any exemptions, and after multiple rounds of public protest, the Trucking Association filed its lawsuit. The complaint, filed in the U.S. District Court for the Southern District of California, alleges that AB 5 violates both the Supremacy Clause and the Interstate Commerce Clause of the United States Constitution.
“Given the realities of trucking, it would be impracticable if not impossible for CTA’s motor-carrier members to provide interstate trucking services by contracting with independent owner-operators and to simultaneously comply with California’s onerous requirements for employees,” reads the complaint. “The direct and real consequence of Dynamex and AB-5, therefore, is that CTA’s motor-carrier members, if they wish to avoid significant civil and criminal penalties, must cease contracting with owner-operators to perform trucking services for customers in California and to shift to using employee drivers only when operating within the State.”
This is, the Trucking Association posits, a violation of the Interstate Commerce Clause because the “ABC test deprives CTA’s motor-carrier members, and other similarly situated motor carriers of the right to engage in interstate commerce — in particular, the interstate transportation of property — free of unreasonable burdens, as protected by the Commerce Clause.”
The lawsuit filed by writers and photographers in the U.S. District Court for the Western District of California, meanwhile, alleges that AB 5 violates the First Amendment of the U.S. Constitution.
“By enforcing content-based distinctions about who can freelance — limiting certain speakers to 35 submissions per client, per year, and precluding some freelancers from making video recordings — Defendant currently maintains and actively enforces a set of laws, practices, policies, and procedures under color of state law that deprive Plaintiffs’ members of their rights to free speech (and) free press,” reads the complaint.
Gonzalez has responded to both lawsuits, but not on the legal merits. In response to the media organizations’ lawsuit, she critiqued the premise that the lawsuit was filed by lawyers from the Pacific Legal Foundation, a libertarian organization that receives corporate funding.
“The Endangered Species Act, The Clean Water Act, Women on Corporate Boards, Tenant Protections, Affirmative Action,” she wrote on Twitter. “Just a few of the things that the Pacific Legal Foundation has filed suit against. No, I’m not surprised they’ve now filed suit against AB5.”
And in response to the trucking industry lawsuit, Gonzalez told the Associated Press in prepared remarks that the lawsuit is a tactic to “delay justice for workers.”
“We expect big corporate interests — especially those who have misclassified their workers for years — to take this fight back to the place they know they can delay justice for workers: the courts,” said Gonzalez.
AB 5 goes into effect Jan. 1.