Port Drivers Take On Low Wages In An Industry Built On A Lie

Port Drivers Take On Low Wages In An Industry Built On A Lie

Port truck drivers aren’t independent contractors: They’re employees of companies that pay them too little for long hours, with no benefits or worker protections.

It’s a David and Goliath story, only in this case there are 120 Davids taking on a hidden Goliath of an industry that every day touches everyone who is reading this in hundreds of ways. The port trucking industry is built on an illegal fiction, designed to rip off the 120 drivers who went on strike at the ports of Los Angeles and Long Beach this week.

They are not alone; 49,000 port truck drivers around the country work long hours at low pay with no benefits or basic worker protections like unemployment insurance or workers’ compensation, because the industry misclassifies them as independent contractors. The drivers’ courageous action is one more facet of a surging labor and community movement, which is starting to take on the captains of America’s low-wage economy.

Virtually everything you are wearing now that was made overseas came through our nation’s ports. So did every imported item in your office or home. Port truck drivers transported those goods from ship terminals to rail yards and warehouse centers, for distribution to stores around the country. Starting more than 30 years ago, when the trucking industry was deregulated during the Carter administration, the industry was taken over by firms with a business model based on driving down drivers’ incomes by treating them as independent contractors instead of employees.

The new model was based on a lie. The drivers weren’t really independent truck drivers, with their own rigs. They still worked for one distribution company, which totally controlled everything about their work – their hours, their shipments, the rates they were paid. The company supplied the trucks they drove. But by insisting the drivers accept the new arrangement if they wanted to work, the companies avoided paying payroll taxes, workers’ compensation, and unemployment benefits, let alone health or retirement benefits. The drivers were forced to pay to lease, fuel and maintain the trucks out of their own paychecks.

The result of this scam has been high profits for the companies, lower wages and no workplace protections for the drivers, plus big losses to the social insurance funds. This arrangement put employers who complied with the law by continuing to treat their workers as employees at a competitive disadvantage.

The port drivers’ story is emblematic of the forces that crushed America’s middle class. Good paying, often union jobs were replaced by low-wage, no-benefit jobs. “Manufactured in the U.S.” was displaced by foreign goods, sold to consumers through the Walmarts and Home Depots and other giant retailers that perch at the end of global supply chains. Government, stripped of resources and will by corporate lobbyists and their wholly owned elected officials, sat by while the law was violated and social insurance programs were weakened. And corporate profits soared.

But times are beginning to change. The strike in Southern California carries with it all the elements and power of the new movement of low-wage workers and their allies to create a good jobs economy. The foundation of the strategy is the willingness of low-wage workers to risk their jobs to fight back. The strategy is driven by strategic, legal, and financial assistance supplied by labor unions, partnerships with community groups, and public campaigns against big brand names.

The strikers, like many other port drivers, are mostly immigrants who often don’t speak English. Only recently did they become aware that their rights were being violated, after a free legal clinic was set up by two community groups at the port. Since then, drivers have filed more than 400 claims against companies under California’s wage and hour laws. The first 19 rulings resulted in an average award of $66,240, largely for wage and hour violations and illegal paycheck deductions for items like truck leases.

The claims are part of an aggressive legal strategy, which includes filings under California’s wage and hour laws, class-action suits, and claims that the companies are violating federal labor laws. The goal is for the firms to face such an onslaught of fines and court orders that they will begin to realize it would be better to abide by the law, rather than continue to defend their practices in court. California Attorney General Kamala Harris could be hugely helpful here if she used the growing number of cases to insist on an industrywide compliance settlement.

The companies are fighting back. “It’s all-out war,” an attorney for two workers who were fired for both supporting a union and pressing wage claims, told me. Green Fleet, the company that fired the workers and one of the companies being picketed, is using the full arsenal of union-busting tactics, including firing workers who are leading union efforts and hiring union busters who threaten workers. The company’s goal is to terrify other workers, so that they won’t support forming a union or file wage claims.

The NLRB ruled in the workers’ favor, establishing that they are employees, not independent contractors, but Green Fleet is appealing in order to delay any relief. The fired workers’ attorneys are asking a federal judge to immediately order the companies to rehire the workers who were fired and to inform all the workers of their right to form a union and protest unfair labor practices.

In the face of this illegal harassment, the 120 drivers at Green Fleet and other firms walked off the job. They want to join the Teamsters union, which is providing key strategic support to their efforts through their Justice for Port Drivers campaign. Many drivers recently saw the benefits of unionization when drivers won union representation at Toll Global Holdings, an Australian based company, which is unionized in their home country. The unionized drivers actually get paid for the hours they spend waiting to pick up merchandise, and receive better wages and benefits.

Los Angeles’ well-organized community-labor coalition, led by LAANE, has turned out hundreds of picketers to join the drivers. The picketers block company trucks driven by drivers who have not joined the strike. The pickets create even longer lines of trucks at the marine terminals, where ships arrive with containers full of goods. This is one way that the strikers can exercise the economic power to get the companies to settle. The Teamsters report that already some terminals have told the companies being struck to stop picking up goods in order to clear the blockade.

Another weapon in the campaign is public pressure on the big brands that are the ultimate beneficiaries of the low-wages paid to the port drivers. All of Skechers shoes are delivered by Green Fleet. Protesters attended Skechers’ annual shareholder meetings, have leafleted stores, and this week had a plane fly over the company’s flagship L.A. store with a banner that read, “Skechers – laced with misery.” As LAANE’s Danny Feingold points out, unlike some other retailers, such as Nike, Skechers has refused to sign a code of conduct with labor standards for its contractors.

Another element in the port drivers’ campaign, as in low-wage workers’ campaigns nationally, is a push to change public policy. There are some 75,000 port drivers around the country, of whom 49,000 are misclassified as independent contractors. The New York and New Jersey legislatures both passed bills in the last year toughening standards and enforcement for misclassification of port truck drivers. While New Jersey’s Governor Chris Christie vetoed that state’s billthe New York legislation signed by Governor Andrew Cuomo includes strict standards and most importantly, civil and criminal penalties.

There is a new movement growing in America, comprised of courageous low-wage workers and backed by unions, community groups, and activists to take on the huge companies that drive the low-wage economy. From fast food, to Walmart, to workers who make car seats and immigrants who wash cars, the movement is learning a new strategy, based on mobilizing workers and the public. The twin goals of this movement are to enable workers to organize unions and to enact new public policy to rebuild the middle class. You can support the movement now, and lend a hand to port drivers who are on strike, by making with a contribution to the Justice for Drivers Hardship Fund. Remember, the device on which you are reading this now was delivered by a port driver.

Richard Kirsch is a Senior Fellow at the Roosevelt Institute, a Senior Adviser to USAction, and the author of Fighting for Our Health. He was National Campaign Manager of Health Care for America Now during the legislative battle to pass reform.

Cross-posted from the Roosevelt Institute’s Next New Deal blog.

The Roosevelt Institute is a non-profit organization devoted to carrying forward the legacy and values of Franklin and Eleanor Roosevelt.

Photo: Barry Lewis via Flickr

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