Intermodal association slams U.S. moves to end independent truckers

The Intermodal Association of North America (IANA) has come out strongly against proposed legislation in the United States that would outlaw independent contractors working as truck drivers.

On June 21, the U.S. Senate Committee on Health, Education, Labor, and Pensions (HELP) considered the Richard L. Trumka Protecting the Right to Organize Act of 2023 (PRO Act). If passed, it could bring an end to independent contractors in the trucking industry.

The Canadian trucking industry recently asked the federal government to make the practice of employing drivers as independent contractors, while treating them essentially es employees, illegal.

According to IANA, the independent contractor model – which is not the same as Driver Inc. – is essential to the intermodal supply chain, accounting for over 80 percent of intermodal truck drivers.

“Independent Contractors are a vital link in the intermodal supply chain, moving cargo to and from intermodal facilities throughout the U.S. These owner-operators are proud, small business owners who enjoy both operational and financial flexibility,” said Joni Casey, IANA president and CEO.

“Although they have the option to secure full-time employment in the trucking industry, they have chosen to remain as independent contractors.”

In a statement, IANA argued that while the independent contractor model remains standard industry practice, recent state and federal actions are eroding its longevity and undermining its significance by chipping away at this business model. California’s Assembly Bill 5, or AB 5, established a test that essentially prohibits the use of independent contractors within the trucking industry.

On June 13, the U.S. National Labor Relations Board modified its standard for determining whether workers are employees or independent contractors under the National Labor Relations Act. This new standard expands the definition of an employee, which IANA claims threatens the viability of independent contractors at the national level.

Some U.S. federal lawmakers are pursuing the PRO Act which would in essence, make AB 5 the prevailing law across the nation. If this becomes law, IANA argued, individuals will no longer have the choice to work as independent contractors, and more than half of these entities are expected to suffer substantial and direct income loss.

“As the Senate HELP Committee prepares to consider the PRO Act, I urge lawmakers to consider its long-term costs. Not only does it strip drivers of the freedom to choose their own schedules and length of haul, but it would also exacerbate the ongoing national truck driver shortage by discouraging them from remaining in or joining the field, at a time when the intermodal supply chain continues to recover from recent disruptions. Congress should be considering how to incentivize drivers to enter the sector rather than passing laws that will force experienced drivers from their chosen profession,” Casey concluded.