On September 22, 2018, Bill (SB-1402) was signed into law in California to become effective January 1, 2019. That law makes “Customers” (generally shippers, exporters, importers, and ocean intermediaries, FMCSA Property Brokers) that engage or use “a port drayage motor carrier” jointly and severally liable with that port drayage motor carrier if that carrier is listed on the Internet Web site maintained by the California Division of Labor Standards Enforcement. This ominous list now identifies port drayage motor carriers which have been found liable to a “port drayage driver” for unsatisfied court judgments, assessments, orders, decisions, or awards, for port drayage services performed for which the drivers have not been paid or expenses for which they have not been reimbursed, plus damages, penalties, and interest. The California Labor Commissioner’s Office, Division of Labor Standards Enforcement, has awarded in excess of $45 million in unlawful deductions from wages and out-of-pocket expenses to more than 400 drivers, and the California Labor Commissioner’s Office noted that drivers have seen little of those awards.
On January 2, 2019, the California Labor Commissioner published a preliminary list of port trucking companies with unsatisfied final court judgments, tax assessments or tax liens. This initial list only covers 19 different trucking companies with a judgment total of approximately $1.6 million. Since as noted above, there was considerably much more money in judgments recently against truckers which had been assessed penalties via judgments—i.e., in excess of $45 million had been assessed, and the initial list contained herein only totals $1.6 million, our sense is that more will be included on the list in the near term.
In the meantime, please note the following:
- If your are an ocean intermediary or FMCSA property broker, please note the truckers on the current list and insure that neither you nor your customers utilize these truckers until they are cleared from the list.
- Because of the disconnect between amounts owed by truckers on this list, and the “over $45 million in outstanding assessments” just a short time back, we are not sure that the whole list has been published, but shippers will only be liable if the trucker is on the list. We expect that this list will be updated even before a month to include all other truckers which should have been on the list but did not make it for whatever reason.
- Truckers may claim they have already paid which may be true. It will take the California Labor Commissioner about 15 days to remove truckers from the list. Our suggestion is that if you wish to use a trucker on the list that claims it has paid, we suggest that you obtain proof of payment within the prior fifteen days.
- The list will be updated about once a month by the California Labor Commissioner’s Office.
- Shippers that utilize truckers on the list will be jointly and severally liable for the outstanding amounts noted on the list. A quick review of the list indicates amounts in four, five and six figures, so these amounts can be hefty.
We will be updating these matters as they change. Advise if you have any questions on this matter.