Thursday, May 24, 2018

Employee or Contractor?

Rule change threatens NY-NJ Port drayage capacity, say truckers.

Are the 10,000 or so truckers who serve the Port of New York and New Jersey employees or independent owner-operators? The wrong answer, says a trucking group, could seriously impact port operations.

The Association of Bi-State Motor Carriers set out their objections to a proposed rule change in how the drivers’ status is determined in a letter May 15 to the New Jersey Dept. of Labor and Workforce Development, reported the Journal of Commerce. Turning over determination of the drivers’ employment status to the IRS, said the association, would further exacerbate an already critical driver shortage, “pushing drivers away from serving at the port due to its burdensome, unduly restrictive regulations.”

The International Brotherhood of Teamsters, though, backed the proposal. The focus on the independent contractor vs. employee issue is a new front in the longstanding dispute between unions, who want to increase the ranks of employee drivers, and companies who do not want the liability and costs of employees.

Debate over the regulation follows an executive order signed by New Jersey Gov. Phil Murphy, creating a Task Force on Employee Misclassification. It follows legislative efforts in 2016 and 2013 to make it easier for owner-operators to be considered employees. Neither of those bills was signed into law, although the 2013 bill got to the desk of then-Gov. Chris Christie, who vetoed it.
Murphy’s executive order said misclassification of employees “deprives New Jersey workers of important legal rights and protections as well as certain employment-related benefits, including unemployment insurance, workers’ compensation, and disability benefits.” With most NY-NJ port activity taking place in New Jersey, state regulations have an outsized effect on the port’s drayage fleet, with 80 percent of the drivers, according to the carriers’ association, classified as independent owner-operators.

The NJ Dept. of Labor declined to comment, as the issue is under review. It is accepting comments on the proposed plan and in the coming weeks will submit its final determination to the governor for review.

Kirk Shearer
President & COO
(973) 726-2103

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