Will latest round of DLSE decisions spur port efficiencies?
Port trucking companies’ responses to the California Division of Labor Standards Enforcement’s (DLSE) flurry of decisions closing out 2015 took a new twist. Instead of appealing the decisions, the three companies involved – Pacific 9 Transportation, Fargo Trucking and WinWin Logistics – let all but a handful of the more than 100 decisions stand.
The companies’ inaction essentially made the decisions, which totaled approximately $19 million owed to drivers in back pay and penalties, final. (In order to appeal, the companies would have had to post a bond for the total judgment amount by the second week in January.) You can see from viewing the decisions that the only really substantive difference between the cases were the judgment amounts each driver is entitled to receive.
Instead of settling with the DLSE, some of these companies seem to have decided to just close up shop to avoid settling claims. Pac 9 recently announced that it is closing operations at the end of January. WinWin ended its operations a few months back. But with new laws on the books that give greater enforcement powers to the California Labor Commissioner, it remains to be seen if this strategy will work.
Pac 9 has been one of the top 10 drayage carriers at the Ports of LA and Long Beach for the past seven years, since the Clean Truck Program began tracking cargo moves by carrier. As such, the company’s closure could spark a wave of much needed consolidation to help strengthen rates.