The Impact of the AB5 State Law on Freight Companies
The California Assembly Bill 5, also known as the AB5, passed in September and is making waves across many industries, including transportation and freight. The AB5 bill limits independent contractors in the state of California, including owner-operator truck drivers and freight companies. It may be a wise decision to take a look at your vendor list and decide who you should work with. Although it may not seem like too large of an issue as a vendor, hiring independent contractors or companies that use independent contractors in 2020 may become a larger issue.
In order to be marked as an independent contractor, the worker MUST follow these three rules known as the ABC Test:
(a) the worker is free from control and direction in the performance of services; and
(b) the worker is performing work outside the usual course of the business of the hiring company; and
(c) the worker is customarily engaged in an independently established trade, occupation, or business.