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AB5 and Container Shipping

The port drayage industry depends heavily on owner-operators driving as independent contractors to licensed motor carriers (LMCs). There are many employee-driven fleets and LMCs with both, but owner-operators make up the bulk of US drayage drivers. California State Assembly Bill 5 (AB5), passed in September 2019 and due to be enforced in 2020, drastically tightens the definition of an independent contractor. To be considered an independent contractor, a California driver must satisfy the “ABC” test: A. The person is free from the control and direction of the hiring entity, both in contract and in fact. B. The person performs work that is outside the usual course of the hiring entity’s busine

Forecasting in the Age of Tariff Warfare and Coronavirus

Projecting container volume for the next year has become even more challenging with the outbreak of the coronavirus in China and its spread into the rest of Asia, Europe and North America. The tariff war with China had a direct impact on trade in 2019 with US imports declining below their 2018 levels, and further tariff threats against the European Union will not help going forward. Perhaps the Phase 1 agreement with China will alleviate the downward pressure on imports, but as the agreement leaves most of the tariffs imposed over the past two years on the books the impact of the trade war is not yet over. Add to this the unknown situation of spread of the coronavirus, particularly in China,

 

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