Anyone who has been following industry events can surely appreciate how busy 2020 has started for the business of the Association. The number one question since fall 2019, and sure to remain number one for 2020, is what is the status of AB 5? More accurately, what is the status of California Labor Code modified effective January 1, 2020 by California Assembly Bill 5 authored by Assemblywoman Lorena Gonzalez, passed by the legislature and signed into law by Governor Newsom in 2019? For simplicity and brevity, we will continue to use AB 5 to discuss the issue.

First, there are several key points to remember whenever the Association or its representatives discuss or present legal issues, specifically outside of our expertise related to the MAX 4 and California Mover regulatory issues as defined by the Household Movers Act in the California Business and Professions Code.

1. THE CALIFORNIA MOVING AND STORAGE ASSOCIATION (CMSA) IS A NON-PROFIT TRADE ASSOCIATION THAT DOES NOT DISPENSE LEGAL ADVICE.
2. ANY IDEAS, CONCEPTS, OR THEORIES THAT ARE DISCUSSED SHOULD BE REVIEWED BY YOUR OWN LEGAL COUNSEL.
3. AB 5 IS UNSETTLED LAW AND YOUR OWN CIRCUMSTANCES MAY PLAY A ROLE IN POTENTIAL OUTCOMES.

Additionally, this is a dynamic issue with new information coming out from many sources. Therefore, it will be some time before anyone can say this question is resolved. We must also remain alert to the possibility that some information, from any source, related to this complex and specialized area of the law will be erroneous.

In less than 10 days since December 31, 2019, we have seen a lot of action related to AB 5.  A federal district court judge issued an order granting a temporary restraining order (TRO) enjoining the State Attorney General and relevant state enforcement agencies from enforcing AB 5 as to any motor carrier operating in California.  The case was brought by the California Trucking Association (CTA).  A follow-up hearing on the TRO is scheduled for January 13th, after which the TRO may continue or the federal district court may further clarify its opinion on the issue. In a separate case, a California Superior Court judge issued an order granting a motion in limine regarding federal preemption and non-retroactivity of AB 5’s “ABC” worker classification test.  Relevant here, the Superior Court judge concluded that, “[b]ecause Prong B of the ABC Test under both Dynamex and AB 5 prohibits motor carriers from using independent contractors to provide transportation services, the ABC Test has an impermissible effect on motor carriers’ ‘prices[s], routes[s] [and] services’ and is preempted by the FAAAA."  Which "motor carriers" would be affected by federal FAAAA preemption (interstate, intrastate, freight, household goods) is not 100% clear yet.  Additionally, Uber, the party that declared that the legislation originally designed to address their business model didn’t apply to them, sent an email to their customers in early January that they were making changes to their model in 2020. They would be switching from a model of set prices to a model of estimated prices with final pricing based upon time and distance of service provided.

Separately, over the last several months CMSA has worked with the Bureau of Household Goods and Services (BHGS) to ensure that the 2020 MAXIMUM RATE TARIFF 4  (MAX 4) was complete, correct, and posted at the earliest possible date. BHGS staff provided us with draft information, early enough for us to ensure that the calculations and amended language was correct. Thankfully, the Bureau’s professionalism made our efforts far easier that in several past years, they also had the document posted on their website on the first day of the year! With the finalization of the 2020 MAX 4 Tariff, CMSA has worked with Milburn Printing on a revised Combined Agreement for Moving Services and Freight Bill that is currently available for purchase.

With all that’s going on this year, you don’t want to miss being a part of CMSA’s 102nd annual convention. Register today and come make memories in flip flops!

January 2020 - CMSA Communicator