Harbor Drivers Independent, Panel Says

In a ruling that could hamper efforts to unionize truck drivers at the nation’s ports, a three-judge panel has found that drivers who haul goods from Los Angeles harbor are independent contractors and not trucking company employees.

The complex class-action lawsuit was filed by Los Angeles attorney Fred Kumetz on behalf of hundreds of drivers, mostly immigrants from Mexico and Central America.

It alleged that three major trucking companies improperly classified drivers as independent contractors to avoid paying for state benefits. The lawsuit also claimed that the companies overcharged drivers for insurance.

A private panel of retired judges, sitting for the Superior Court of Los Angeles and the Workers’ Compensation Appeals Board under a special fast-track arrangement, sided with the trucking companies in ruling that the drivers were properly classified as independent contractors.

The case had been closely watched across the country because nearly all ports classify drivers the same way. And the ruling has stopped labor campaigns in their tracks because independent contractors cannot form or join unions.

At the Los Angeles port alone, there have been at least three significant efforts to unionize truck drivers in the last 20 years. All failed due to the independent contractor classification.

“This has monumental significance for any city that has a port,” said attorney Bob Millman, who represented Intermodal Container Service Inc., Interstate Consolidation Inc. and Cartage Service. “It would not be economically feasible to treat these people as drivers. The cost of goods would just go skyrocketing.”

Evidence introduced at trial showed the drivers named in the suit took in about $40,000 to $70,000 a year but also spent thousands on insurance, fuel, equipment and maintenance. One of the named drivers, Luis Montoya, testified that he preferred being an owner-operator because he could make more money that way.

Kumetz said that he would probably appeal the case and that there have been conflicting opinions from the state Workers’ Compensation Appeals Board and National Labor Relations Board. “It’s extremely confusing,” he said. “That’s why we need a published opinion from the Court of Appeals or the California Supreme Court that will enlighten everybody as to what the law is.”

Millman said the case is likely to “have a major chilling effect” on efforts by labor unions to organize port drivers.

The International Brotherhood of Teamsters has been gearing up for a large-scale organizing drive that would coordinate actions at ports nationwide. Ed Berk, a lead organizer in that effort, said he hadn’t yet read the preliminary ruling, which was handed down Friday, but said he was moving ahead with scheduled meetings with drivers.

“I don’t think they’re going to throw in the towel on this one court case,” he said.