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Driver issuesTruckingTrucking RegulationTrucking Risk & Compliance

New Jersey’s owner-operator law in limbo for now, but risk remains

New Jersey bills that would block trucking and other industries from using independent contractors are stalled, with the state legislature not scheduled to take up a vote on the issue through its current session.

But those battling the proposed law caution that the risk of leasing trucks from owner-operator drivers remains and the bills could still move forward in the next few weeks.

The bills, S4204 and A5936, would require New Jersey employers to follow the state Department of Labor’s version of the “ABC” test when determining whether to classify a worker as an independent contractor or as an employee.

State Sen. Steve Sweeney, the main sponsor of the legislation, said in an opinion piece the bills just codify the definitions and regulations that the state’s courts and regulators have used for years to classify workers.

He said the bills aim to give independent contractors the same legal protections and benefits afforded to employees and to prevent violations of minimum wage and overtime laws by employers. He added that “no one’s livelihood is being destroyed by this legislation.”

Yet the legislation remains unpopular within the trucking industry due to the inflexibility of the ABC test. Its second prong, that a worker be regularly employed in a profession outside of the employer’s usual business, is considered a particularly tough standard for trucking companies to meet, essentially forcing them to classify a worker as an employee.

Trenton political observers expected the bills to pass prior to the legislature’s upcoming winter recess. But neither bill was scheduled for this week’s Senate or Assembly sessions. Nor are they scheduled for any of the remaining sessions through the current legislative year, which ends Jan. 13.

If the legislature does not present a bill to Gov. Phil Murphy before then, the legislation would essentially have to start from scratch.

Alida Kass, president of the New Jersey Civil Justice Institute, said the bills do appear to have stalled, but “as always, that could change.”

“I have no doubt [the bills’ sponsors] are still trying,” Kass said. “But the word is that it’s not going to happen in the lame duck session.”

The Senate’s version of the bill, S4204, was amended to reflect the Assembly version of the bill, passed through the labor committee, and is ready for a floor vote. The Assembly version, A5936, still has to go through an appropriations committee hearing before being put to a floor vote.

“The bills have stalled, but they are not dead,” said Lisa Yakomin, president of the Association of Bi-State Motor Carriers. “There’s still plenty of time to move the bills through the legislature before the end of the current session.”

The legislature “certainly put it aside for now,” she added. “But I expect that if they can, they will move it in the new year.”

The Bi-State Motor Carriers started a Change.org petition that has gathered nearly 10,000 signatures against the legislation. But Yakomin credited outreach to industries beyond trucking for keeping the law at bay.

“Port trucking has been dealing with this for several years, the push to eliminate or limit independent contractors,” Yakomin said. But “the first version of the bill was so inclusive of so many industries, it got the attention of independent contractors throughout the state.”

Outside of trucking, a group called Fight for Freelancers is highlighting the effect of the law on writers, photographers, graphic artists, public relations experts, healthcare practitioners, teachers, massage therapists, translators and those in similar professions.

New Jersey’s bill is modeled largely after California’s AB5 legislation, which will go into effect next year. One tangible result of AB5’s passage has been that sports website sbnation.com will no longer use independent contractor writers in California. Instead they will be replaced by a smaller pool of employee writers.

Along with building a broader coalition to oppose the bill, Yakomin and others have also shifted the fight away from Trenton by bringing it home to local municipalities as well. The New Jersey towns of South Orange and Washington Township sent letters to Sen. Sweeney voicing their opposition to the bills, while the city council of Woodcliff Lake passed a resolution opposing S4204.

“Now that we are aware of all the industries that are affected, not just trucking, we need to give these folks a seat at the table and hear their stories,” Yakomin said.

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Michael Angell, Bulk and Intermodal Editor

Michael Angell covers maritime, intermodal and related topics for FreightWaves. His interest in transportation stretches back several generations. One great-grandfather was a dray horseman along the New York waterfront and another was a railway engineer in Texas. More recently, Michael has written about the shipping industry for TradeWinds, energy markets for Oil Price Information Service, and general business topics for FactSet Mergerstat and Investor's Business Daily. When he is not stuck in the office, he enjoys tours of ports, terminals, and railyards.

16 Comments

  1. If this law don’t go through something else has to happen in the new year I was in new York City shelter a month ago and also talked to some port truck leased ops from New Jersey and these drivers have no protection when they get hurt or sick or cheated by bad trucking companies. The cost to the taxpayer is too high and these drivers families.

    1. If they need protection, as an owner operator, they need to purchase insurance to protect themselves. If they choose to not buy insurance to protect themselves then they must live with the consequences of that decision. I am not saying this to be harsh but to show that that is just the reality of being a business owner. If they are saying they cannot afford it as a reason for not purchasing it then they need to look at their business plan and figure out where they can charge more or cut other unneeded expenses. Just because someone wants to own their own truck, so they can be their own boss,doesnt mean they have a business head to do so or even the resources to fund that type of an operation and that is their fault not the person they are leasing onto or getting loads through. I have been an owner operator for almost 20 years now and I myself didn’t carry the insurance I should have to begin with, partly because I had other expenses I needed to take care of and partly because I felt the risk was worth taking because I could make more money and was in good health (looking back now it’s called ‘young and dumb’) I had a family to feed and take care of that a “job” wasn’t going to meet the financial needs that I wanted to achieve. If these ‘port owner ops’ NEED the protection but cannot afford it then what they really need is a JOB but that doesn’t mean we need the government to tell them that and everyone else that means they need to face the facts that they just aren’t cut out to be an owner operator. I now own multiple trucks, and have several owner operators working with me. Most came living paycheck to paycheck, several have told me how they were able to get out of debt since working for me and several others have goals to be debt free in the next year or two. We have good work, I treat my guys how I would want to be treated, whether they are an employee or owner op.

    2. People dont understand this is not about taking down owner operators running their own company.

      This is about stopping the abuse of employees paid as 1099 who clearly are not running their own business.

      Level the playing field.
      Misclassification has been illegal.
      Either everyone can hire employees as ind contractor or no business can.

      Leased owner operator is an employee with truck payments…
      Looks like plenty of uneducated learn the hard way or running a business with no freedom to pick and choose work.
      Prime, DART, and drayage do an excellent job on lease OO propaganda.

    3. You obviously know nothing at all about the trucking industry and owner operator drivers. These drivers own their own rig, an investment of between $30,000.00 and $185,000.00, depending on the year and model of the truck.

      These are business owners, and this idiotic legislation will force companies to eliminate those positions, and they will not be setting these contractors up as employees, its is not happening. What this will do is just what it is doing in California. Every carrier with contractors living in California has informed all these contractors that they must move out of the state of California or be discharged from their contract.

      No company is going to pay these people as employees because they are not employees.

  2. Lol.. who gives a crap about New Jersey or California. I suggest drivers stay out 100 percent. These idiot deserve the government they voted for. It’s up to the citizens to vote out the morons or pay the consequences. High we coats for everything that’s brought in. I’m sure the unions are 100 percent behind this.

    1. The immigrant business owners love abusing employee classification as they have illegals with no other choice!
      Look at NJ CA Chicago scum bags say in the ads you get 1099 form at end of year but want an employee driver.

    2. You should “give a crap” because it’s going to spread to other states until it’s ingrained in every state .

      Stay Tuned !

      In my humble opinion …….

      1. It is going to spread to New York City maybe all of New York State and 3 other states as well as Quebec in Canada. The insurance companies have ripped off a lot more drivers than me. Home insurance companies are doing the same thing. My house was hit by a windstorm 6 and half years my house was condemned. The same thing is happening with private disability insurance. .The cutback in health coverage is putting a bigger load the states and Nonprofit organizations. The nonprofit groups can not cover the costs both in Canada and certain states in the U. S. What do suggest instead?

  3. Dont confuse owner operators running their own business/authority and 1099 paid employees.

    Way too many companies are paying employees via 1099, not just truckers.

    1099 employment is a scam backdoor to hiring illegals.
    Contributes to low rates and wage stagnation.
    Great for business tho!

    1. Art you are exactly right. I’m a owner/ operator and I talk to employees who get paid 1099 all the time. Employers do what they can to make money. If some one is stupid enough to be a 1099 employee with out owning the truck is foolish. I feel that is a good law now the owner/Operator who is working for the company any way should get benefits and keep there same wage. Employers can afford it. Let them dig in there own pockets rather then the owner/ operators

  4. Be vigilant if you eventually choose to join a labour union . Some of their leaders are unethical , mislead the public through propaganda , and attempt to harm communities through the application of unethical tactics . Their ignorance is tarnishing their reputation . However, this clearly shows the public that not all labour unions can be trusted to represent their members in an honorable way . They even put their own members in harms way .

    Unifor is CURRENTLY behaving in such a dishonourable way in Regina towards Truck driver fuel haulers at the Refinery Co-Op . The police had to get involved , now the Co-Op filed an injunction against Unifor . These Unifor labour union picketing abusers are abusing truck drivers ! It’s a disgrace !

    Furthermore , they ignorantly tried to manipulate the community for their support by boycotting the Co-Op . They’re asking the community to shoot themselves in the foot ! How ignorant can that particular labour union be ???

    The Refinery Co-Op just donated $83 thousand to a community cancer center from sales they generated recently ! If the community would support such an ignorant boycott , they literally would be boycotting themselves .

    That goes to show you who THIS particular labour union really cares about . Nobody else but themselves no matter the cost to the wellbeing of others . They’re not only ignorant , they’re unethical and selfish as well .

    In my humble opinion ………….

  5. Let’s start revising and pushing legislature that affects every single other industry aside from trucking starting with government pay cuts and less of their hocus pocus cauldronite moonshining appointments. Let’s make them all meet from 11pm to 7am and actually keep the courthouses open for a full 24hrs with every judge on the bench so they can actually get some real work done and solve some real world problems…none of them will care about the autonomous vehicles out there killing people until it’s one of their own fu$#%^ morons!!!

  6. Daniel, do your homework… it’s not a democratic or republican thing… it’s free enterprise at its finest… lobbying and money to push through specific agendas of those who will benefit most. Doesn’t that say all you fail to recognize…

  7. YOU KNOW WHAT, IHAD ENOUGH WITH THIS COUNTRY GO FUCK UR SELVES,IM SELLING MY HOUSE AND MOVING TO LAC LA BIECH CANADA I CAN MAKE MORE MONEY UP THERE WITH MY CDL CLASS A HAZMAT TANKER ,LIECENCES

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