Driver Reclassification Battle Pushes Onward In New York

The newest legislative battle over truck driving is taking place in New York. As states across the country struggle to reclassify parcel drivers and drayage truck operators, lawmakers in New York are trying to lump owner-operators in with employee drivers. The differences between the two truck driving jobs are not clear to the legislators. Port operations in Washington, New Jersey and California are proposing a similar change to truck company classifications. The laws being discussed in New York would affect all owner-operators currently working in the state. Both the NY State Motor Truck Association and the Owner-Operator Independent Driver Association have spoken out against this classification change.

The director of regulatory affairs for OOIDA, Joe Rajkovacz, explained that this change would cause a wealth of problems for New York state drivers. Independent operators would have the burden of proof put on them to prove that they were not full employees of a company. Under current legislation, the state holds the burden of proof when it comes to tax disputes for truck driving jobs. The New York State Motor Truck Association is trying to warn drivers that the bill may strip away their ability to work as a independent contractor is they are engaged in the same activities as trucking companies.
Issues found with the legal codes surrounding the construction industry in the state sparked the reclassification focus. Unfortunately, the problem the law is attempting to fix is not a real issue in the trucking industry. The research that discovered misclassification issues in New York did not investigate truck driving jobs, but only looked at problems within the construction field. The organizations against the bill say that this is an inappropriate way to change classifications within their industry.

The country-wide push to reclassify owner-operators is coming after the American Trucking Association won a lawsuit in the U.S. 9th Circuit Court of Appeals. The association won a victory against the Los Angeles city department after they imposed expensive and difficult port entry requirements. The ruling took away any state's right to try and control the routes, services or rates used by trucks traveling between states. The labor groups pushing for the reclassification were not deterred by this decision.

The drivers and legislators that support this bill explain that truck drivers deserve the benefits federally mandated for employees. They claim that forcing drivers to work as independent contractors puts a burden of equipment costs on them that would be waived if they were all considered employees. Unfortunately, trucking companies that hire owner-operators don't agree, and small businesses will likely shut their doors if the bill passes. This could have a serious effect on product deliveries across the state. Both the Assembly and Senate versions of the bill are currently before the associated Labor Committees.

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Comments

Hi Mad Mountain. My opinion is aimed at the enrite lease/owner-op industry because it simply makes no sense to go into business as an owner-op or lease driver. It's a commodity business there's very little profit in it. As far as your numbers go, if you're pocketing a profit of 64k on 200k in revenues each year, that means you have an profit margin of about 33%. Not too shabby considering the average profit margin for the trucking industry is under 3%. So somehow you're making 11 times the profit that the average person is making in the trucking industry.a0So if the average company is making 3% and you're making 33%, why isn't anyone moving in on your gig to take it from you? Tell me what's your secret? How do you make so much more profit than the rest of the industry? And if you're making that much money, why don't you have 10 trucks, or 1000 trucks?Why is that every owner-operator or lease driver I talk to has all of these outlandish numbers that make no sense? Either their fuel costs equate to paying $1 per gallon when fuel is actually $4 per gallon, or they have a 33% profit margin when the industry average is 3%, or something outlandish like that. It's never anything that borders on making sense. I hear these stories from time to time about guys who are doing awesome at it, and yet I can never get one single clear answer as to how they're actually managing to do it. What makes you different? What's your niche? What's your business model that sets you apart from the rest of the trucking companies in the nation? If I believed your numbers I would go out tomorrow and buy 10 trucks. I would hire 10 drivers, pay them each $45k per year, and I'd pocket 20k per truck per year and be a millionaire in a few years and disappear to my own island in the Caribbean. Why aren't you doing that if there's so much money in it?

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