On Tuesday, The California Trucking Association (CTA) filed its first lawsuit as an attempt to challenge a sweeping new labor law that attempts to give workers benefit and wage protections who participate in the “gig economy.”
The CTA claims that the 70,000 independent truckers would be unable to work under the new legislation; which the CTA alleges violates federal law.
The legislation is set to become law on January 1 and will make it significantly harder for companies to classify workers as independent contractors instead of employees. Increasing costs on many businesses in the trucking industry and reduced their ability to hire workers.
The law could also affect construction workers, Uber, Lyft, and DoorDah drivers, janitors and home health aides as they are predominantly hired on as 1099 employees.
In response to the new law, Uber, Lyft, and DoorDash have stated that they intend to spend $90 million on a 2020 ballot measure to oppose the law from going through if they can’t negotiate other rules for their drivers. Uber has stated that it will keep treating its drivers as independent contractors and take court action, if needed, to defend that decision.