Truckers protesting a state labor law effectively shut down cargo operations at the Port of Oakland on Wednesday, it was announced.
“The shutdown will exacerbate container congestion,” according to a port statement, and port officials are urging shipping terminal operations to resume.
Hundreds of independent big-rig truckers have blocked cargo movement in and out of terminals at the port, which is one of the top ten busiest container ports in the country, according to its website.
There is no word on when the protest will end, but it is exacerbating supply-chain issues that have already resulted in cargo ship traffic jams at major ports and stockpiled goods on the dock. The protest comes as toymakers and other industries prepare for peak import season as retailers stockpile goods for the fall holidays and back-to-school items.
The truckers are protesting Assembly Bill 5, a 2019 gig economy law that made it more difficult for businesses to classify workers as independent contractors rather than employees, who are entitled to minimum wage and benefits like workers compensation, overtime, and sick pay.
Last year, a federal appeals court ruled that the law applies to approximately 70,000 truck drivers who can be classified as employees of companies that hire them rather than independent contractors.
It was dubbed a “massive victory” for exploited truckers by the International Brotherhood of Teamsters. The California Trucking Association, which sued over the law, argued that forcing independent drivers who own their own trucks and work their own hours to be classified as employees would make it more difficult for them to make a living.
The legal battle slowed enforcement of the law, but the United States Supreme Court recently decided not to review the decision.
Truckers have now asked Gov. Gavin Newsom to meet with them to discuss the situation.
Meanwhile, no word on when the state will start enforcing the law, which is still being challenged in lower courts.
Messages left with the governor’s office and the Governor’s Office of Business and Economic Development were not returned by Wednesday evening. Dee Dee Myers, the director of the business and economic development office, told CNBC that “it’s time to move forward, comply with the law, and collaborate to create a fairer and more sustainable industry for all.”
Ports are already struggling to handle container traffic, much of which comes from Asia. When the COVID-19 pandemic hit in 2020, cargo traffic to ports plummeted dramatically. But it soon recovered and has been thriving ever since.
“We understand the protestors’ frustration at California ports,” Port of Oakland Executive Director Danny Wan said in a statement. “However, a prolonged halt in port operations in California for any reason will harm all businesses operating at the ports and cause California ports to lose market share to competing ports.”
While the port handles a variety of cargo, it is an important distribution point for agricultural products in California.
“The supply chain is already in trouble.” The Agriculture Transportation Coalition’s executive director, Peter Friedmann, told the Wall Street Journal, “This is a huge disruption.”