New California 1099 Classification Laws in 2020 Impact All 50 States

January 21, 2020 Truck Accident Blog

New California Independent Contractor Law for Truckers

The new California independent contractor law regarding the 1099 classification of truck drivers are already having an effect nationwide. An article in the L.A. Times mentioned that out of 13,000 truck drivers serving the ports of Long Beach and Los Angeles, only a few hundred are currently classified as employees. Trucking companies generally evaluate their decision to fire an independent contractor or rehire the driver as an employee based on which option is cheaper.

Federal Interstate Commerce Clause

The federal Interstate Commerce Clause gives unprecedented amounts of authority to the federal government in terms of affairs that involve the interstate highway system. This also indicates that the California ruling could have a ripple effect throughout all the other states. Large semi-trucks routinely pass through multiple states, so major changes in a place like California tend to have an effect on the rest of the industry, similar to a slow-moving avalanche that picks up momentum over time. Misclassification changes to laws in 2020 cause companies to suddenly adjust to a situation that’s developed slowly over decades, and this always has a jarring effect. Legal services are helpful when navigating a rapidly changing legal environment.

Possible Effects of California’s New Law

There are different approaches that might be taken by carriers, owner-operators and other drivers classified as 1099. For example, some companies might simply wait to see what happens before doing anything. Others might cut off independent contractors from existing contracts and rehire only employees to remain compliant with the new laws. This could have extraordinary effects on the owner-operators and 1099 truck drivers already operating in the state. It also sends a signal to the rest of the states that these laws could affect them as well, and many are likely to contact the office of a qualified truck accident lawyer for advice on how to proceed.

New California Independent Contractor Law and Independent Truck Drivers

new california independent contractor law

The issue of how the new California laws affect all other states boils down to the legal concept of liability. In any accident, there might be more than one party who can be held liable for damages. This could be the company, the driver or even a manufacturer of faulty parts. Auto drivers can also be liable for reckless driving that puts people at risk. Liability is at the very core of any misclassification lawsuit. This is especially the case when a truck is involved in a collision with another vehicle. For example, many truck accident law firms routinely deal with cases in which a personal injury claimant files a lawsuit against several defendants. This means that the company and the independent contractor, or owner-operator, could be responsible for paying damages awarded to the plaintiff. However, each legal case is affected by the changes in the laws. Large changes in California’s laws will impact the entire industry over time. This has implications for all the other states because many are already going through similar types of litigation.

Some parts of the industry will feel these changes immediately because these companies routinely route drivers through California. It’s helpful to remember that the 1099 independent contractor classification itself is a huge change in precedent, which occurred during a relatively short span of time. In a way, the California legal system is reverting back to a period of time before truck drivers could be classified as independent contractors at all. To some companies, this represents a sudden shift, but it’s only a return to a regulatory environment before companies exercised their power to reduce obligations to their truck drivers through classifying them as contractors while still exerting de facto control over working conditions.

Legal Precedent and Truck Liability

Legal precedent itself is the best way to understand this dynamic situation. Whenever a truck accident lawyer accepts a case, one of the first things that he or she must accomplish is to determine the status of the truck driver. This will show if the liability will fall mainly with the truck company or the driver, for example. The status of independent contractors across the entire industry could change rapidly once the new laws go into effect in California.

Distribution of Liability

There is always the potential for shared liability in any legal claim involving a commercial truck. For example, consider a situation in which there were errors committed by the truck driver in reaction to faulty truck tires. This is a relatively common problem because tire manufacturers routinely face these types of lawsuits. In such a case, the trucking company might be partially liable in a case involving an independent contractor who functions as an owner-operator, but the manufacturer of a faulty product could also share in the liability.

The distribution of liability across multiple parties is an established legal precedent, so it can be expected to continue even as the new laws go into effect. However, this also leads to a process where states adopt the legal precedent started in a place like California. This motivates some companies to prevent the laws from going into effect even after they’re passed. The final result is a complex legal environment that can change rapidly at any moment. This is especially true for any truck driver who is classified as an independent contractor while operating within a state that has recently changed the classification laws.

Interstate Commerce and New California Independent Contractor Law

This can affect drivers from any state because so many truck drivers who are independent contractors travel in and out of the state of California on a regular basis. The new laws could affect these drivers in unexpected ways, so it is imperative for them to have a qualified lawyer on their side. Get a consultation, and you’ll eliminate a lot of the guesswork involved in deciding whether to route a truck driven by a 1099 driver into California, for example. Our team has the experience and track record necessary to help you make informed decisions about complicated topics related to this industry.

Our Law Firm

Our legal professionals can help you navigate this complex system while protecting your rights every step of the way. We have a long history of serving the needs of various clients, so don’t hesitate to give us a call as soon as a legal question arises. Accidents involving semi-trucks are often difficult and complex, and changes in the law always create another layer of complexity. This is why professional legal assistance is critical. We have a proven track record of helping clients in similar positions, and we are always available for a consultation.

Our dedicated legal team can help you deal with the specific issues you face. Each situation is different, so our legal strategies are always customized to help you get the most desirable outcome possible. Dealing with any legal situation involving a commercial truck can be extremely complicated. Get in contact with the experienced truck lawyers at RAM Law if you need help with a case involving an independent truck driver. We can be reached at (732) 247-3600 if you want to contact our office located in New Brunswick, NJ. We also have another office located in Somerville, NJ, and the phone number for that location is (908) 448-2560.

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