California truckers are challenging a law regarding gig economy drivers.
According to AP, the California Trucking Association filed the first lawsuit challenging a new labor law that seeks to give wage and benefit protections to gig economy drivers, which include rideshare drivers at companies like Uber and Lyft.
The organization is arguing that the legislation violates federal law and would deprive more than 70,000 independent truckers of their ability to work. The group cites that many would have to drop $150,000 investments in clean trucks and the right to set their own schedules in order for companies to comply with a law it says illegally infringes on interstate commerce.
The law will go into effect on Jan. 1, making it harder for companies to classify workers as independent contractors rather than employees, who are entitled to minimum wage and benefits such as workers compensation.
“Independent truckers are typically experienced drivers who have previously worked as employees and have, by choice, struck out on their own. We should not deprive them of that choice,” association CEO Shawn Yadon said in a statement.
AP reports that the court set a new, three-prong test for companies to use to determine how to classify their workers:
- To be labeled as a contractor, a worker must be free from control of the company
- Performing work "outside the usual course of the hiring entity's business"
- Engaged in an independently established trade, occupation or business of the same nature as the work they are performing
The law is estimated to apply to nearly two-thirds of independent contractors.