You may be already wondering what else this year can throw at us, I know that I am. It has been a year of rapid and frequent change, both personally and professionally, and we are only in early May. Movers have seen unusually high volume that has not shown any linkage to the historic seasonality of our business.   

While many like to tout the mass exodus from California, we continue to see record prices on home sales across the state. The shortage of housing inventory continues to be the story and price driver. My sales philosophy has been that movers do better when home prices are rising, creating a wealth effect that drives purchases related to the home sale. The good news is that people are moving, the challenges are almost everything else.

We are seeing shortages and price inflation in everything from the materials that are necessary to pack, ship and store the goods, the equipment to transport, and most importantly the labor to complete every part of the process. As I said it is only May, but our shared experience says that our best opportunity to address and solve our issues is to work together—something that CMSA and its membership have been doing well for over 100 years.

CMSA conducted convention board meetings on May 11 and 12, and issues related to AB 5 continue to be an important topic. The ongoing litigation related to the implementation of AB 5 was central to our discussion and the following information was shared with the board.

CA AB 5 was set to go into effect on January 1, 2020, but on January 16th, 2020, a federal district court in Southern California prevented the state of California from enforcing AB 5 against interstate motor carriers. Editor’s Note: This class is limited to entities defined as interstate motor carriers by the FMCSA which may limit impacted groups. This effort was led by the California Trucking Association (CTA) in which they requested a preliminary injunction to block enforcement of CA AB 5 against interstate motor carriers. Citing a 1994 law that forbids any state law “related to a price, route, or service of any motor carrier … with respect to the transportation of property.” the district court stated that the 1994 law “likely preempts ‘an all or nothing’ state law like AB 5.

In May 2021, in a 2-1 panel decision by the Ninth Circuit, the appellate court panel overturned the January 16th ruling which will now allow the state of California to enforce AB 5 against interstate motor carriers who have contracted with owner operators. The panel cited that CA-AB 5 is like other state laws (such as those regarding meal and rest periods) that the Ninth Circuit has maintained.

The CTA has stated that they will appeal the court’s decision on the state’s independent contractor law. The appeal of that panel’s decision must be filed within 14 days of its ruling. After the appeal is filed 29 judges in the Ninth Circuit would vote on whether to rehear the case. If majority agree to review the panel’s decision 11 judges will be assigned to hear it. If the court agrees to review the case, the lower court’s injunction will stay in place until a final decision in the case is made. Many believe the fight over AB 5 could go on in appellate courts for as long as two years, and if it reaches the U.S. Supreme Court would stand a good chance to be decided in CTA’s favor.

The result of the boards discussion was an agreement that CMSA should once again conduct a fund-raising campaign within its membership to collect and distribute funds to CTA, in support of their litigation fund. Any funds collected in this campaign will be forwarded 100% to CTA. Look for an email soon.

May 2021 - CMSA Communicator