Dive Brief:
- The L.A. City Council is currently investigating whether a land use nuisance abatement law can prevent trucking companies known to violate misclassification laws from doing business on city-owned property at the port, American Shipper reported last week.
- Approximately 1,150 port truck drivers have filed claims against their erstwhile employers since 2010, with judges ruling in their favor at least 97% of the time.
- While authorities have slapped trucking companies with fines and warnings, this is the first time a government entity has looked into banning them from doing business.
Dive Insight:
Driver misclassification suits are increasingly common and increasingly problematic for the industry.
Though some lines have taken proactive measures to reduce their liabilities lest further accusations of misclassification be lobbied, others have gone so far as to try to cover their tracks by retroactively changing contract wording, or rely on antiquated wording within the Fair Labor Standards Act (FLSA).
The fact that the city of L.A. has taken another step toward potentially acting upon its previously considered interest in banning trucking lines known for misclassifying drivers indicates how serious the matter has become.
Supply chain managers interested in avoiding future disruption may want to investigate the practices of suppliers sooner rather than later in order to make necessary changes, or else risk loss of business at the Port of L.A.
