LA Port Truckers Highlight Problems in Shift to Independent Contractor Status

January 29, 2015

Where Is This Road Taking Us?

As Shakespeare once asked, "What's in a name?" For truckers working the ports of Los Angeles and Long Beach, and by extension others across the country, their continued livelihood depends on the answer.

Drivers and trucking companies have been locked in a bitter labor dispute, causing the truckers to strike last November in an effort to obtain more equitable working conditions. At issue is the loss of employee status as companies now list them as independent contractors.

The difference is a major financial advantage for companies as it allows them to forgo benefits such as medical insurance and paid vacation. Truckers also receive no guarantee of work, yet they are contractually restricted from seeking work elsewhere.

Most crucial is the ability of the companies to charge drivers for work-related expenses such as truck leasing and insurance. The advent of clean-energy truck regulations made this practice particularly crippling, as the increased deductions often leave drivers making less than minimum wage.

The main impetus behind this change has been pressure from big-box discount retailers for low shipping costs. They in turn are reacting to their customers who insist on bargain prices. With 40 percent of goods being shipped to the U.S. passing through these ports, a work stoppage can have a ripple effect throughout the supply chain.

Martin Davis, founder of Pace Freight Systems, demonstrates that it is possible to successfully operate a trucking company while treating drivers fairly. Pace offers decent wages and benefits in the belief that having reliable and happy employees is a win-win situation.

One company, Shippers Transport Express, has agreed to allow its workers to decide on whether or not they want union representation, but tensions continue to run high between the trucking companies and drivers. Rely on Trucker to Trucker for updates on this story and other news that impacts you.

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