Monday, May 21, 2018

Motor Carriers Face New Challenge to Contract Driver Use

A California Supreme Court ruling threatens to upend the use of independent-contractor drivers by motor carriers in the state, creating turmoil for the trucking industry.

In Dynamex Operations West Inc. vs. Superior Court, the court adopted a narrower standard for determining if a worker is an employee or an independent contractor in California wage-and-hour disputes.

Most workers should be considered employees based on the intent of decades of California policy, the court said in the April 30 decision.

“It’s too soon to tell, but this could be a huge upheaval,” said Richard Coyle, president of Devine Intermodal, a West Sacramento freight and logistics company that supplements its fleet of employee drivers with independent contractors in some of its business lines.

The ruling was made in the case of delivery drivers contesting their independent contractor status. The court specifically targeted the question of how to define an employee in a class-action lawsuit filed under California wage-and-hour rules, which govern overtime pay, meal breaks and other basic employment rules.

Despite the narrow focus, businesses worry the ruling will spread to cover any dispute over whether a worker is an employee or independent contractor, including, for example, workers’ compensation lawsuits. It also could be found to include any California business or out-of-state firm that does business in state and uses independent contractors.

“Whenever the California Supreme Court speaks, especially so definitively and somewhat clearly, it will be utilized in different types of industries,” said Hillary Arrow Booth, a Los Angeles transportation lawyer and president of the Transportation Lawyers Association.

How drivers should be classified has become a contentious issue in California.

Since 2011, California port truckers have filed 948 claims alleging that they have been misclassified as independent contractors. Drivers have been awarded more than $48 million in about 450 of those cases, according to the latest data from the California labor commissioner’s office.

Both Los Angeles and Long Beach city officials are looking at whether they have the legal power to take action against motor carriers at Southern California’s port complex who they believe are misclassifying drivers as independent contractors rather than employees.

For now, trucking executives are meeting with their lawyers and trying to work out the potential impact of the court ruling.

“Some of the truck company operators are just sifting through this and figuring out what they are going to do,” said Robert Ramorino, president of Roadstar Trucking Inc. and Peppertree Warehouse & Distribution in Hayward, Calif.

He uses a handful of independent contractor drivers, or owner/operators as they are known in the industry.

“Obviously an operation that uses a lot of independent contractors, they’ve got more risk facing them now,” he said.

That risk includes potential worker lawsuits, regulatory actions over misclassification of workers and potentially higher operating costs because employees cost a company more than independent contractors. They might face a shortage of truck drivers if owner/operators are unwilling to work as employees. The ruling also could affect the outcome of current court cases.

At the same time, industry observers say state or federal legislation could be passed that would carve out exemptions, such as exist in New Jersey, or clarify the uncertainty left by the ruling. Federal law, for example, prohibits states from passing direct economic regulations that might affect interstate motor carriers related to prices, routes or services, which the ruling might be interpreted as doing. A key change made in 2004 to a Massachusetts statute created a similar test to the one adopted by the California court but was determined by the state’s high court two years ago not to apply to motor carriers because it ran afoul of that federal law.

THE ABC TEST IN CALIFORNIA

The court adopted the so-called ABC test that exists in some jurisdictions and requires a company to classify a worker as an employee unless it can prove all three of these factors:


  1. Free from control and direction: The worker is free from control and direction of the hiring entity in connection with the performance of the work, both under the contract for the performance of the work and in fact.
  2. Work is outside of hirer’s usual business: The worker performs work that is outside the usual course of the hiring entity’s business.
  3. Independent: The worker is customarily engaged in an independently established trade, occupation or business of the same nature as the work performed for the hiring entity.

The biggest problem for trucking companies that use independent contractors is obviously the second rule.

“That is going to be a very hard threshold for a lot of these employers to meet,” said Doug Bloch, political director at Teamsters Joint Council 7 in Northern California, the Central Valley of California and Northern Nevada.

Previously in California, under the common law known as the Borello test, there were multiple factors to consider, the principal one being whether the hiring company had the right to control the manner and means of accomplishing the desired result.

It’s not just an issue for California trucking companies. Industry players in other states also are looking to see what happens.

“California is a little ahead of, but we are right behind, we are under attack,” said Gail E. Toth, executive director of the New Jersey Motor Truck Association.

New Jersey has had an ABC test for decades, but there are exemptions for many industries, Toth said. As of this year, those exemptions are the potential target of a new state task force on worker misclassification. The California ruling is adding pressure to those efforts, she said.

Some in the industry draw a distinction between entrepreneur owner/operator truck drivers, who know how to run a successful business, and drivers labeled independent contractors by companies that control them as employees but avoid the expense of actually employing them.

Bloch, the union official, said that in the Teamsters national agreement there is language that covers owners/operators. Many trucking companies start with a single truck.

“I would never deny that there is a place in the supply chain for owner/operators,” he said.

“But for the small or large companies that have people that are working exclusively for them, and hiring those people as independent owner/operators, and this is the only place they go for work and they do it more than full– time, I would be nervous about that.”

Yet the California court said the desire of owner/operators to remain independent is outweighed by the need for all workers to be able to access the state’s extensive worker protections under its employee labor laws.

Devine Intermodal previously won an expensive and lengthy court battle with state regulators over alleged misclassification of employees as independent contractors, Coyle said.

“We finally won, completely, but with the new interpretation, we would have lost,” he said.

UPS, UPS Freight Strike-Authorization Vote Timeline

UPS and UPS Freight Teamsters will vote soon to consider giving their respective negotiating committees the right to call a strike, if necessary.

The vote will be conducted by secret ballot as UPS and UPS Freight contract votes have been done in the past, but this time UPS and UPS Freight Teamsters will be using the telephone and Internet through the BallotPoint Election Services voting system.

All members will receive a standard ballot packet in the mail. But instead of a paper ballot that needs to be mailed, each member will receive an individual access code and simple instructions on how to use the access code to vote by telephone or internet.

This ballot process will be conducted by BallotPoint, an election services provider which has specialized in electronic balloting and polling since 1999. Their system is secure and protects the secrecy of each member’s vote. In other words, no one will know how you voted!

The Teamsters Union has used BallotPoint extensively over the past three years to conduct contract ratifications.  All of the ratifications were conducted without incident or challenges.

Regarding the upcoming strike-authorization vote, here is the timeline:


  • Balloting Information to be mailed on or about Tuesday, May 15 
  • All members should receive their ballot by Monday, May 21
  • Local Unions can begin submitting forms on the members behalf to the Package Division requesting to be re-credentialed on Tuesday, May 22
  • For Local Unions submitting forms on behalf of members to be re-credentialed, the DEADLINE is Friday, June 1 Noon Eastern Time
  • Votes are due by 8 p.m. Eastern Sunday, June 3
  • Deadline to submit challenges is Monday, June 4 at 8 p.m. Eastern Time
  • The vote count is at 8 p.m. Eastern, Tuesday, June 5 


Click the links to read the strike-vote materials being mailed to UPS members and UPS Freight members.

Freight Teamsters at ABF Ratify National Master Portion of Contract

Drivers, Dockworkers, Office Workers Also Approve Most Area Supplements

Teamsters employed at ABF Freight System, Inc. have ratified the national master portion of the agreement and all but 9 supplements. The supplements that were rejected, however, must be addressed before the national agreement can take effect. Votes were counted today. Click here for a list of the vote by supplement.

“We realize that some of our ABF members have concerns that are unique depending on their areas,” said Ernie Soehl, Director of the Teamsters National Freight Division and Co-Chairman of the Teamsters National Freight Industry Negotiating Committee (TNFINC). “We will work with the Supplemental Committees in those areas to discuss those issues. We will then work to address supplemental issues with the employer and, if appropriate, seek to obtain revisions to the supplements for re-balloting so that the national master contract and all the supplements can take effect.”

The national contract covers about 8,000 drivers, dockworkers, mechanics and office workers.

Once fully ratified, the new national contract will restore the week of vacation that was previously given up, will provide annual wage increases, and will significantly improve protections for members from purchased transportation. It will also provide for annual increases to health and welfare funds and maintains the current contribution rates for all pension funds and provides protection to members if a pension fund expels ABF.

 ABF Voting Results

Saturday, March 24, 2018

Fifth Week of UPS Negotiations Highlights Excessive Overtime, Harassment, CDL Requirements

The Teamsters UPS National Negotiating Committee has concluded its fifth week of negotiations and achieved tentative improvements to parts of the contract covering excessive overtime, harassment and other issues. The UPS Freight National Negotiating Committee made progress on CDL training requirements this week.

“The committee reached tentative agreements on a number of issues,” said Denis Taylor, Director of the Teamsters Package Division and Co-Chairman of the union’s UPS Negotiating Committee. “The tentative agreements on particular articles are not final until the entire contract is negotiated, but the committee wants to keep members updated.”

So far the negotiations have focused on the union’s proposals. The Teamsters and the company have reached tentative agreements on many proposals, including articles 3.1, 3.3, 3.7, 6.4, 8.7, 12, 17 and 37.

The Safety and Health Committee has reached tentative agreements on Articles 14, Sections 1 and 2; Article 16, Section 4; Article 18, Sections 1, 3, 6, 18.1, 21 and (new section) 28; Article 20, Section 4; Article 35, Section 3.3; and Article 44, Section 1 and 2.

On Article 37, the union has made significant improvements to Sections (a) harassment, (b) eight-hour days and (c) over 9.5.

On Article 37, Section (a), the tentative agreement will create a new Article 37 National Committee to deal with harassment. The new committee will have a sitting arbitrator to break deadlocks. The committee will have contractual authority to award a monetary penalty of up to three days pay depending on the severity of the offense. The new language would also require any member of management deemed by the committee to have committed two or more violations in a two year period to appear in person before the committee for any subsequent grievance(s).

Under the Article 37 (b) tentative agreement, if UPS fails to adjust a driver’s dispatch to comply with this section, the driver will receive the current two hour penalty and also retain the eight hour request for later use.

On the Article 37 (c) tentative agreement, the drivers will no longer need to wait for a violation to get on the 9.5 list or go to the manager to get on the list. The union will collect the names of drivers who want to be on the 9.5 list and provide those names to management in January and June. In addition, a driver may elect to add or remove their names to the list at ANY TIME during the two five month periods, with one week's notice to UPS.

Finally, the provision dealing with repeated violations has also been significantly improved. The current language triggers a review by UPS and the union after three violations in a five month period and a higher level of review after any subsequent violation in that same five month period. The new language removes the first level review and triggers the higher-level review after four violations in a calendar year, which will expedite that process.


UPS Freight
The Teamsters National UPS Freight Negotiating Committee made strides in securing stronger language for members during this week’s negotiations.

The union has tentatively agreed to a true training program that will encourage bargaining unit employees to obtain their CDL in order to fulfill full-time CDL positions. The qualifications to achieve these full-time driving positions have been streamlined as well, by reducing the time requirements.

The next round of negotiations is scheduled for the week of April 8.

Monday, March 19, 2018

Herschel Evans of Holland is CVSA’s 2018 International Driver Excellence Award Winner

The Commercial Vehicle Safety Alliance (CVSA) is proud to announce Herschel Evans of the trucking company Holland as the winner of the 2018 International Driver Excellence Award (IDEA). Evans has driven more than 3 million miles over 30 years; 25 of those years with Holland.

“After my company nominated me, I read the impressive bios of the previous winners and I did not think I belonged in that group,” said Evans. “I feel extremely honored to be selected.”

Launched in 2015, IDEA recognizes commercial motor vehicle drivers who distinguish themselves conspicuously and beyond the normal call of duty through the achievement of safe operation and compliance carried out with evident distinction for an extended period of time.

Like many commercial motor vehicle drivers, Evans truly loves what he does. “It is never the same day twice,” he said. “There is nothing boring about driving for a living. You get to see the inner workings of many different places. All of the places that make your community run are kept running by us drivers delivering what they need. Every day has a sense of doing something that is necessary.”

Full Story Here..............

Pension committee must deliver on retirement promise

Years of hard work by Teamsters, retirees and other unions to reform the faltering multiemployer pension system finally are paying off. Late last month, congressional leaders announced the members of a bipartisan congressional pension committee, tasked with finding a solution to the nation’s looming pension crisis by this November, and the panel met for the first time on Wednesday.

It’s not a moment too soon. There are about 1.5 million retirees in desperate need of quick action to save the retirement nest eggs they spent decades contributing to, on the premise they would be financial secure in their golden years. There also are hundreds of thousands of workers who are enrolled in these pension plans who deserve assistance, too.

As it stands, there are about 200 multiemployer plans across the country — including the Teamsters’ Central States Pension Fund — that are in danger of failing. The House-Senate Joint Select Committee, chaired by pension reform advocate Sen. Sherrod Brown (D-Ohio), needs to find a vehicle that will deliver for these hard-working Americans who are paying, or have paid, into the pension pool and have played by the rules all their lives.

Luckily, the panel’s 16 members don’t have to look far to find a vehicle that would fit the bill. This union supports the passage of the Butch Lewis Act of 2017 (H.R. 4444/S. 2147), which has gained bipartisan support since its introduction in Congress late last year by Sen. Brown and Rep. Richard Neal (D-Mass.).

Republicans such as Reps. Peter King and Dan Donovan of New York, Chris Smith, Frank LoBiondo, and Tom MacArthur of New Jersey, Brian Fitzpatrick and Ryan Costello of Pennsylvania, and Kevin Cramer of North Dakota and Don Young of Alaska understand the value of the bill and should be lauded for supporting this legislation. The measure would boost financially-troubled multiemployer pensions so they don’t fail. It would create an agency under the Treasury Department that would sell bonds in the open market to large investors such as financial firms.

The agency, the Pension Rehabilitation Administration (PRA), would then lend money from the sale of the bonds to the financially-troubled pension plans. Plans that are deemed “critical and declining,” as well as recently insolvent but non-terminated plans and those that have suspended benefits, would be eligible to apply for the program. 

Pension plans borrowing from PRA would be required to set aside the loan proceeds in separate, safe investments such as annuities or bonds that match the pension payments for retirees. For those plans needing additional help to meet retiree obligations, the Pension Benefit Guaranty Corporation would be available to make up the difference. Those applying for loans to the PRA — which would be charged with approving all loans before they could be issued — would have to submit detailed financial projections. And, pension plans that have borrowed money would have to submit reports every three years to the PRA to show that the loans are working.

Last December, Teamsters were among the hundreds of union members who came to Capitol Hill to rally in support of the Butch Lewis Act. There, they joined Senate Democratic Leader Chuck Schumer (N.Y.), House Democratic Leader Nancy Pelosi (Calif.), Sen. Brown, Rep. Neal and others to push for the legislation. Retirees were on hand to share their stories.

Mike Walden, a former truck driver and Teamster retiree from Akron, Ohio, recognized years ago that pensions such as the one he receives from the Central States were in dire straits. Now he is president of the National United Committee to Protect Pensions and chairman of the Northeast Ohio Committee to Protect Pensions.

He told those on hand that day that any cut in pensions would devastate the well-being of retirees and force many out of their homes and into a life that, at their advanced age, they cannot handle. “Many of us are old; we can’t go back to work because we’ve had joint replacements, or some of us have lost our eyesight. We have medications that wouldn’t allow us to drive the trucks or work in warehouses like we used to,” Walden said. “Many can’t afford their medications if you reduce their pensions. They’ll die.”

That is what is at stake in this battle for justice. These workers aren’t asking for a handout; they just want what is rightfully theirs. It’s time for the joint committee to get to work and endorse this legislation that will make retirees whole. They’ve waited long enough.

Teamsters, ABF Grapple with Detailed Economics

The Teamsters National Freight Industry Negotiating Committee (TNFINC) and ABF Freight System began discussing wages and benefits this week and the Teamsters remain committed to fighting hard to protect members’ interests.

The current 2013-2018 contract expires at the end of this month. After several weeks of progress on language issues, the inevitable topic of pay and benefits has now been formally opened. As expected at this stage, the parties appear far apart, but the union is committed to fighting hard to maintain the current structure of health care and retirement benefits that are extremely important to the membership. The union also made clear to the company that it believes the robust economic environment for trucking services that has improved over the past year, along with the demand for seasoned drivers and the valued services of all ABF Teamsters, should be reflected in any economic settlement.

The company did not provide an immediate counter offer and instead is taking time to study the union’s economic proposal. Nevertheless, the parties continued working to address some outstanding language issues as well as some supplemental issues.

“I would have liked more back and forth this week in terms of economic discussions but I hope the company takes the next several days to appreciate the important contributions that all Teamsters make to the long-term success of this company,” said Ernie Soehl, Co-Chairman of TNFINC and the union’s lead negotiator. “We will have small group meetings next week to better analyze each party’s positions, and then fully resume talks on March 26 with the goal of reaching a new agreement by the month’s end.”

Members of the National Negotiating Committee also took time this week to visit the ABF Kansas City terminal and speak directly with members.

“Our ABF membership is an outstanding group of freight Teamsters who value both the company’s historic success and the Teamster’s role in making that happen,” Soehl said. “One thing was made clear: they really expect ABF to step up and do the right thing during these difficult contract negotiations.

We are now in the most difficult phase of these important talks but remain united and committed as a bargaining team to reaching a tentative agreement that meets both the goals of the membership while also allowing the company to maintain and grow its successful position in the trucking industry. The continued support of the membership over the next couple of weeks will be absolutely critical toward the positive and successful resolution of these talks,” Soehl said.