The FAAAA Does Not Preempt AB 2257, “ABC” Test

People v. Super. Ct., 57 Cal.App.5th 619 (Nov. 19, 2020)

The Federal Aviation Administration Authorization Act of 1994 (“FAAAA”) preempts state laws “related to a price, route, or service of any motor carrier…with respect to the transportation of property.”[i] However, worker-classification laws that are generally applicable and that do not prohibit the use of independent contractors are not preempted by the FAAAA.[ii] The Second District Court of Appeal determined that Assembly Bill 2257, the most recent codification of the “ABC” test adopted by the California Supreme Court in Dynamex Ops. W. v. Super. Ct. (2018) 4 Cal.5th 903, is one such law, and therefore the FAAAA does not preempt the application of the ABC test to truck drivers of interstate motor carriers.

The argument turned on prong B of the test: “the worker performs work that is outside the usual course of the hiring entity’s business.”[iii] Defendants contended the FAAAA preempts the ABC test because prong B makes it impossible for a motor carrier to hire an owner-operator as an independent contractor. The Court agreed with the People, however, that the ABC test is an employment law that applies to all California employers and creates a rebuttable presumption that a worker is an employee while not prohibiting motor carriers from hiring independent contractors. As such, the ABC test is not the type of law the FAAAA was meant to preempt.

The appellate court further rejected Defendants’ contention that the ABC test was not a law of general application simply because it exempts several occupations and industries.

[i] 49 U.S.C. § 14501(c)(1).

[ii] People ex rel. Harris v. Pac Anchor Transp., Inc. (2014) 59 Cal.4th 772, 785-87.

[iii] The Court noted that this issue currently is pending before the Ninth Circuit and that there is a circuit split as the First Circuit has held that prong B of the Massachusetts ABC test (which contains the same language as California’s) is preempted by the FAAAA.

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