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Legislators told trucking companies deliberately misclassify workers

  • Photos by Walter Jones/ Morris News Service- Anthony Phillips, who operates 70 trucks at the Port of Savannah, turned to his colleagues in the audience for agreement Tuesday as he told a Senate committee in Savannah that shipping companies wrongly classify drivers as independent contractors rather than employees so they can avoid paying benefits and expenses. Pictured on the panel listening to the testimony is, Legislative Assistant Donna Nealey, left, Chairman Josh McKoon, R-Columbus, and Sen. Lester Jackson, D-Savannah, right.
  • Veteran truck driver Carol Cauley of Stand Up for Savannah choked up as she testified Tuesday before a Senate committee in Savannah. She said because trucking companies classify owner-operator drivers as independent contractors instead of employees there is no health insurance.

Two independent truckers choked up separately as they testified before a legislative committee Tuesday about the toll they say comes from companies misclassifying workers as independent contractors instead of employees.

The emotional moments came in the middle and end of a daylong hearing by a subcommittee of the Senate Insurance and Labor Committee assigned to study worker classification. Other testimony came from legal experts, trade groups and a labor union.

A study by the National Employment Labor Project estimates that nearly one in every three workers nationally is improperly classified and compensated. That resulted in $2.7 billion in taxes going paid in 2006, the most recent year available.

In Georgia 82 percent of truckers hauling freight from the ports are misclassified, according to Rebecca Smith, the project’s deputy director. That means they earn about $29,000 yearly compared to $35,000 for drivers paid as employees.

As contractors, the owner-operators have to cover their own expenses, and most drivers don’t buy health insurance because money is so tight, said Carol Cauley, a veteran driver representing the group Stand Up for Savannah.

“If we take one day off, it takes us 90 days to get caught back up,” Cauley said between sobs. “God help us if we have to take off a week because we’re sick.”

More than a dozen truckers took a turn at the microphone to share their complaints with senators. Some talked of attempts 25 years ago to address the same issue — attempts that resulted in their being cited for violating federal laws against collusion. A couple called for a strike that would cripple port operations, and one even warned that frustrations could boil over to the point of violence.

Georgia Ports Authority’s Garden City Terminal averages more than 200,000 truck turns a month.

A lawyer from the Georgia Department of Labor said worker classification is a routine part of audits by the 50 or so investigators at the agency, but Sen. Lester Jackson, D-Savannah, suggested that was too few auditors in a state with 220,000 employers and 4 million workers.

A trade association executive said the system works well for most of the industry.

“Some of what you’ve heard today is true. Some of it is inaccurate,” said Ed Crowell, president of the Georgia Motor Trucking Association.

Labor attorney Alston Correll, who represents employers, predicted that heavy-handed legislation could discourage companies from moving jobs to the state.

“It is clear that they are looking at how is the state viewing employers and that’s not just low taxes,” he said. “I’m urging caution.”

But one after another, truckers insisted they were getting the raw end of the deal.

The trucking industry isn’t alone, according to other witnesses. The head of the South Georgia Mechanical & Erectors Association said widespread misclassification makes it harder for conscientious companies to compete with those who save money by cheating workers, and a representative of a local Plumbers & Pipefitters Union said his review of files show 100 percent of contractors on federal projects in the state misclassify workers.

Chairman Josh McKoon, R-Columbus, announced that two more hearings will be scheduled and that no decision has been made about whether to propose legislation. But he said, “I heard some things that, frankly, were pretty disturbing.”

The final person who signed up to speak, Jerome Irvin, hobbled up to the lectern and said he was the oldest trucker present, having begun in 1969.

The giant man hung his gray head as he choked up, pleading for action as two other truckers quietly walked up and put their arms on his shoulder to offer support.

“Right now, the situation these drivers are in is deplorable,” he said. “You have young men living in their rigs because they can’t afford to go home. They have to sleep when they can and drive as much as they can to try to make a living for their families. All because of the greed of companies that want to make more and more.

“You’ve heard the cry of the people. You’ve heard from the companies; they don’t want to see this change,” he said. “But it’s time to do what is right to do.”

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