* California - No end in sight for legal wrangling over harbor trucker employment status
-- The legal wrangling over the classification of drayage company drivers as being either employees or independent contractors has been going strong for 10 years now, yet closure could still be many years off... The Teamsters union, buoyed by recent victories in misclassification suits, is convinced the courts and various federal and state agencies have demonstrated that the preponderance of evidence indicates harbor truckers are company employees and therefore ripe for unionization... Greg Stefflre, a trucking company owner and attorney who has represented both the American Trucking and California trucking associations, said many of the legal victories in misclassification suits have occurred in California, where the courts and government agencies “trend toward paternalism,” and place the burden of proof for demonstrating independent contractor status on the companies. “Whether a worker is an employee or a contractor is largely a matter of public policy,” he said... Stefflre explained that ocean carriers in effect took control of drayage pricing by quoting rates that included not only the port-to-port move, but also the drayage haul from the port to the receiving warehouse. Pricing became so competitive after deregulation that large blocks of freight shifted between carriers for as little as $5 a container... In this volatile pricing environment, motor carriers had to find the best tool they could in order to compete, which was the owner-operator model, he said. This model also works for the drivers, because the independent contractors are not wed to any one company... Stefflre said an analysis of every business model in every port around the country would indeed show that some companies are engaging in practices that can be interpreted as an employer-employee status... The big turning point in misclassification, at least in Southern California, came with implementation of the Los Angeles-Long Beach clean-truck plan and subsequent requirements throughout the state to replace old, polluting trucks with clean, post-2007 trucks, Stefflre said. Owner-operators suddenly had to replace their $15,000 polluting trucks with $100,000 to $150,000 clean trucks, but since many of the drivers’ credit ratings did not allow them to finance the purchases, trucking companies acquired the vehicles and leased them to the drivers under a lease-purchase arrangement... However, the terms of some lease-purchase arrangements result not only in a strong degree of control over the drivers, but also chargebacks to the drivers that significantly reduce their earnings and, in some instances, result in “negative earnings,” Julie Gutman Dickinson, a partner in the Los Angeles law firm of Bush Gottlieb said... Money, of course, is an important factor in this struggle. The Teamsters maintain that many of the owner-operators across the country can barely make ends meet. Stefflre countered that some studies have shown the average annual earnings for owner-operators is $51,400, or about $10,000 higher than average wages in the country... Dickinson said she is convinced that the trend toward employee status that is most prevalent in Los Angeles-Long Beach will spread across the country. She added that employee status does not mean drivers can not own the trucks... Stefflre said the desire for entrepreneurship in the U.S.A. will guarantee the survival of the independent contractor model. He noted that many large trucking companies started with one or two trucks. “Without small companies, they wouldn’t grow into big ones,” he said... The cases that reached the 9th U.S. Circuit Court of Appeals in San Francisco were heard by a court that leans toward classifying drivers and independent contractors in most industries as employees, Stefflre said, but he predicts that when those decisions are appealed, “The U.S. Supreme Court will slap the 9th Circuit down” ...
(Photo: Toplift at Container Yard) - Long Beach, CAL, USA - J.O.C., by Bill Mongelluzzo - Mar 09, 2015
* California - East Coast Ports benefited from West Coast cargo diversions
-- In a sign of how bad the port congestion problem grew on the West Coast this January, East Coast ports ended up handling 45 percent of the cargo container traffic that entered the United States, up from 36 percent during the same month last year... Normally, the West Coast ports would have handled about 64 percent of all container traffic in January, but that dipped to 55 percent... A crippling work slowdown on the West Coast was resolved when a tentative agreement was reached Feb. 20 between the International Longshore and Warehouse Union and the longshore workers’ employers, the Pacific Maritime Association—made up of shipping lines and port terminal operators. But some 20 cargo container ships are still stuck at anchor waiting for a berth to unload their merchandise at either the Port of Los Angeles or the Port of Long Beach... Because of the port congestion problems on the West Coast, cargo container volumes at the nation’s major ports dropped considerably in January due to less cargo movement on the West Coast. According to the “Global Port Tracker” report for the National Retail Federation, January’s volume of 1.24 million 20-foot containers slipped 9.5 percent from the same month in 2014... February cargo container volumes fared better with an estimated 1.27 million cargo containers coming through U.S. ports, up 2.3 percent from the previous year. March will see cargo volumes surge, rising nearly 17 percent to 1.52 million containers... For the first half of 2015, cargo volumes will increase 4.5 percent over last year to 8.7 million containers...
(Photo: The Port of Savannah, Georgia, is home to the largest single-terminal container)
Los Angeles, CAL, USA - California Apparel News, by Deborah Belgum -March 9, 2015Labels: trucking industry news USA
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