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The Ninth Circuit Court of Appeals held today that the Federal Aviation Administration Authorization Act of 1994 (“FAAAA”) does not preempt application of California’s Assembly Bill 5 (“AB 5”), codified as amended at Labor Code section 2775, against motor carriers.
See Cal. Trucking Ass’n v. Bonta, No. 20-55106. This decision reverses a preliminary injunction against enforcement of AB 5 against motor carriers that a federal district court granted early last year. Employers in the transportation industry should take notice and review their independent contractor practices immediately.
The Facts
In September 2019, following the California Supreme Court’s decision in Dynamex Operations W. v. Superior Court, 4 Cal. 5th 903 (2018), California enacted AB 5, which codified the so-called “ABC test” for classifying workers as either employees or independent contractors. Subject to various exceptions, the ABC test generally supplants the so-called Borello test as the primary test for classifying workers.