Legislature passes bill that penalizes retailers hiring rule-breaking trucking companies

A bill that would penalize retailers that hire trucking companies which have legal judgments against them for labor law violations is now a signature away becoming law after it was passed by the California legislature on Friday, Aug. 31.

Senate Bill 1402, authored by state Sen. Ricardo Lara (D-Bell Gardens), was passed by a majority vote in the Senate on Friday afternoon – right at the start of Labor Day Weekend — after being approved by the state Assembly the day before and sent along to Gov. Jerry Brown.

“The bill seeks to end the exploitation of port truck drivers who are being left behind, even though America’s economy could not run without them,” Lara said. “Senate Bill 1402 will clean up our port trucking industry in a way that is fair for absolutely everyone and protect some of our most vulnerable workers.”

Under the legislation, when retailers hire trucking companies that have unpaid legal judgments against them, those retailers become jointly liable should the trucking companies commit new violations of state labor and employment laws.

Such violations could include  failure to pay wages, imposing unlawful expenses on employees, failure to provide worker’s compensation insurance and misclassifying employees as independent contractors.

SB 1402 also mandates that port trucking companies have access to a list of trucking companies that failed to pay final judgments, with the list prepared and maintained by the state Division of Labor Standards Enforcement.

Although the state’s major seaports took no position on the legislation after it was introduced by Lara earlier this year, the mayors representing California’s three largest ports — Long Beach’s Robert Garcia, Los Angeles’ Eric Garcetti and Oakland’sr Libby Schaaf – all publicly supported SB 1402.

More than 40 percent of U.S. shipping-container traffic moves through L.A., Long Beach and Oakland, according to statistics from the ports. The about 25,000 port truck drivers in the state routinely face wage theft and illegal pay deductions, according to Lara’s office.

“Port truckers are delivering for the world’s biggest brands, but working for poverty wages. California’s economic engine does not go without them, and they need to share in the benefits,” said Lara, whose district includes the Port of Long Beach.

Lara introduced the bill following a 2017 investigation by USA Today, which found that some Southern California port trucking companies were “forcing” drivers to finance their own trucks by taking on debt they couldn’t afford and that in some instances, where drivers were cheated out of wages by their employers.

The bill was sponsored by the Teamsters and the California Labor Federation, which consists of more than 1,200 labor unions. It was also supported by the Natural Resources Defense Council and multiple community and social justice groups.

“Truckers power our economy forward every day — they deserve a living wage and benefits that enable them to provide for themselves and their families,” Garcetti said in a statement after the bill’s passage. “This bill will help us hold bad actors accountable for wage theft, and I’m pleased that our legislature has passed it today.”

The Senate approved the bill 26-12, while the Assembly passed it on a 53-26 vote. It is now awaiting the governor’s signature.

“We are grateful for the leadership of Sen. Lara for introducing this landmark legislation,” Fred Potter, Vice President, International Brotherhood of Teamsters and Director of the Teamsters Port Division said after the bill’s passage. “We urge Governor Brown to sign SB 1402 to restore dignity to the hard-working men and women in the driver’s seats by cleaning up our port trucking industry.”