When Talavera could not afford repairs, the company fired him and seized the truck-- along with $78,000 he had paid towards owning it.On Monday, Nanette Barragan, a freshman congresswoman whose district isn’t far from L.A.’s port was with the Teamsters to stand with them in solidarity on this issue. This morning she told me that her cousin is a truck driver. “I know first hand how hard our truck drivers work to make ends meet. Some of them don't even make minimum wage; this is unjust. I stand with our working families who deserve a fair and just wage."
Talavera was a modern-day indentured servant. And there are hundreds, likely thousands more, still on the road, hauling containers for trucking companies that move goods for America’s most beloved retailers, from Costco to Target to Home Depot.
These port truckers-- many of them poor immigrants who speak little English-- are responsible for moving almost half of the nation’s container imports out of Los Angeles’ ports. They don't deliver goods to stores. Instead they drive them short distances to warehouses and rail yards, one small step on their journey to a store near you.
A yearlong investigation by the USA Today Network found that port trucking companies in southern California have spent the past decade forcing drivers to finance their own trucks by taking on debt they could not afford. Companies then used that debt as leverage to extract forced labor and trap drivers in jobs that left them destitute.
If a driver quit, the company seized his truck and kept everything he had paid towards owning it.
If drivers missed payments, or if they got sick or became too exhausted to go on, their companies fired them and kept everything. Then they turned around and leased the trucks to someone else.
Drivers who manage to hang on to their jobs sometimes end up owing money to their employers— essentially working for free. Reporters identified seven different companies that have told their employees they owe money at week’s end.
The USA Today Network pieced together accounts from more than 300 drivers, listened to hundreds of hours of sworn labor dispute testimony and reviewed contracts that have never been seen by the public.
Using the contracts, submitted as evidence in labor complaints, and shipping manifests, reporters matched the trucking companies with the most labor violations to dozens of retail brands, including Target, Hewlett-Packard, Home Depot, Hasbro, J.Crew, UPS, Goodyear, Costco, Ralph Lauren and more.
Among the findings:
• Trucking companies force drivers to work against their will-- up to 20 hours a day-- by threatening to take their trucks and keep the money they paid toward buying them. Bosses create a culture of fear by firing drivers, suspending them without pay or reassigning them the lowest-paying routes.This isn’t a case of a few bad trucking companies accused of mistreating a handful of workers.
• To keep drivers working, managers at a few companies have physically barred them from going home. More than once, Marvin Figueroa returned from a full day’s work to find the gate to the parking lot locked and a manager ordering drivers back to work. “That was how they forced me to continue working,” he testified in a 2015 labor case. Truckers at two other companies have made similar claims.
• Employers charge not just for truck leases but for a host of other expenses, including hundreds of dollars a month for insurance and diesel fuel. Some charge truckers a parking fee to use the company lot. One company, Fargo Trucking, charged $2 per week for the office toilet paper and other supplies.
• Drivers at many companies say they had no choice but to break federal safety laws that limit truckers to 11 hours on the road each day. Drivers at Pacific 9 Transportation testified that their managers dispatched truckers up to 20 hours a day, then wouldn’t pay them until drivers falsified inspection reports that track hours. Hundreds of California port truckers have gotten into accidents, leading to more than 20 fatalities from 2013 to 2015, according to the USA Today Network's analysis of federal crash and port trade data.
• Many drivers thought they were paying into their truck like a mortgage. Instead, when they lost their job, they discovered they also lost their truck, along with everything they’d paid toward it. Eddy Gonzalez took seven days off to care for his dying mother and then bury her. When he came back, his company fired him and kept the truck. For two years, Ho Lee was charged more than $1,600 a month for a truck lease. When he got ill and missed a week of work, he lost the truck and everything he’d paid.
• Retailers could refuse to allow companies with labor violations to truck their goods. Instead they’ve let shipping and logistics contractors hire the lowest bidder, while lobbying on behalf of trucking companies in Sacramento and Washington D.C. Walmart, Target and dozens of other Fortune 500 companies have paid lobbyists up to $12.6 million to fight bills that would have held companies liable or given drivers a minimum wage and other protections that most U.S. workers already enjoy.
Since 2010, at least 1,150 port truck drivers have filed claims in civil court or with the California Department of Industrial Relations’ enforcement arm, known as the labor commission.
Judges have sided with drivers in more than 97% of the cases heard, ruling time after time that port truckers in California can’t legally be classified as independent contractors. Instead, they are employees who, by law, must be paid minimum wage and can’t be charged for the equipment they use at work.
The rulings stop there. They do not address specific allegations of abuse by drivers, including whether trucking companies physically barred them from leaving work or ordered them to work past federal fatigue limits.
But allegations like those have been made in sworn testimony in hundreds of the cases, virtually all of which ended with trucking companies ordered to repay drivers for truck expenses and lost wages. The USA Today Network found that at least 140 trucking companies have been accused by at least one driver of shorting them of fair pay or using threats to squeeze them to work longer hours.
Prominent civil rights leader Julian Bond once called California port truckers the new black tenant farmers of the post-Civil War South. Sharecroppers from that era rented farmland to make their living and regularly fell into debt to their landlords. Widespread predatory practices made it nearly impossible for the farmers to climb out.
Through lease contracts, California’s port truckers face the same kinds of challenges in ways that experts say rarely happen in the U.S. today.
“I don’t know of anything even remotely like this,” said Stanford Law School Professor William Gould, former chairman of the National Labor Relations Board and one of the nation’s top labor experts.
“You’re working to get yourself out of the debt. You just don’t see anything like that.”
…Some company owners said their lease-to-own programs were a favor to truckers who might otherwise have been out of work. And there are drivers who make it through the contract to own their trucks, something that’s grown more common with time and a rebounding economy. Drivers who can't make a living aren't working hard enough, many company executives say.
“Our owner very generously went out and purchased a fleet of clean trucks,” said Marc Koenig, a vice president at Performance Team, which has lost cases to 21 drivers at the California labor commission. “That’s what really frustrated our owner. He really reached out and helped these guys.”
…California’s port truckers make it possible for the Walmarts and Amazons of the world to function. Even so, most of the two dozen retail companies contacted by the USA Today Network declined to comment, some saying they had never heard of the rash of labor violations at their primary ports of entry.
Only Goodyear said it took immediate action. Spokesperson Keith Price said in a statement that the tire giant dropped Pacific 9 in 2015, “within two weeks” of California labor commission decisions in favor of dozens of drivers.
The few others that issued statements said it was not their responsibility to police the shipping industry. Retailers don't directly hire the truckers who move their goods at the pier. They generally hire large shipping or logistics firms that line up trucking companies through a maze of subcontractors.
…For decades, short-haul truckers at the nation’s ports relied on cheap clunkers to move goods to nearby warehouses and rail yards.
With little up-front investment, drivers-- most of them independent contractors who owned their own trucks-- could make a decent living squeezing the last miles from dilapidated big rigs that weren’t suited for the open road.
In October 2008, that changed dramatically in southern California, home of the nation’s busiest ports, Los Angeles and Long Beach. State officials, fed up with deadly diesel fumes from 16,000 outdated trucks, ordered the entire fleet replaced with new, cleaner rigs.
Suddenly, this obscure but critical collection of trucking companies faced a $2.5 billion crossroads unlike anything experienced at other U.S. ports.
Instead of digging into their own pockets to undo the environmental mess they helped create, the companies found a way to push the cost onto individual drivers, who are paid by the number and kinds of containers they move, not by the hour.
There are 800 companies regularly operating at the LA ports. Almost all of them turned to some form of a lease-to-own model, some without thinking through the consequences, said industry consultant and lobbyist Alex Cherin.
“Flying by the seat of their pants and making it up as they went along,” he said of the scramble to find trucks for drivers. “Ultimately what they were trying to do was survive in a business with very thin margins.”
Truckers at dozens of companies describe the same basic scene. They were handed a lease-to-own contract by their employer and given a choice: Sign immediately or be fired. Many drivers who spoke little English said managers gave them no time to seek legal advice or even an interpreter to read the contract.
It was "take it or leave it," according to Fidel Vasquez, a driver for Total Transportation who said he couldn’t read the contract because it was in English.
Jose Juan Rodriguez owned his own truck and drove primarily for Morgan Southern, where two dozen drivers have filed claims for back pay at the California labor commission and civil court. Like many drivers, Rodriguez said he didn’t understand what he was signing, but felt he had no choice.
His wife has stage three breast cancer and his adult son has severe brain damage requiring frequent doctor visits.
“Where do I sign?” Rodriguez recalled asking right away. “The only thing I had to worry about is work, because I have a family.”
The contracts work like sub-leases. Knowing drivers could not qualify for their own loans or leases, trucking companies arranged to finance their fleets. Then they had drivers sign up for individual trucks.
Drivers gave their old trucks-- many of which they owned outright-- to their company as a down payment. And just like that they were up to $100,000 in debt to their own employer. The same guys would have had a tough time qualifying for a Hyundai days earlier.
As far back as August 2008, a trucking finance firm warned Port of Long Beach board members that 40% of drivers were likely to default on truck leases. But no one stopped the deals, which place almost all of the financial risk onto the workers.
Drivers' names were not on the truck titles. And many contracts effectively barred drivers from using their truck to work for other companies.
The companies also retained the power to decide how much work to give their drivers. They decide who gets the easiest and most lucrative routes-- and who gets to work at all.
That leaves drivers in constant fear of upsetting managers, who can fire them for any reason, or simply stop sending them business, a process some call “starving” them out of the truck.
On a five-year lease, drivers could pay in for four years and 11 months. If they got sick, fell behind on the lease or were fired in the last month, they could lose everything--as if they had never paid a dime.
“The truck was never his,” one California labor commission hearing officer noted in a March, 2014 ruling. “And he has nothing to show for all the time and money he spent.”
…Drivers who signed up for leases watched their take-home pay plummet and often had no choice but to work longer hours.
After emigrating from Nicaragua in 1992, Samuel Talavera Jr. drove a truck at the Los Angeles harbor and made an honest living. Since 9/11, all truckers working at ports of entry must be legal residents.
Talavera bought his wife, Reyna, a house and took his daughters to Disneyland.
But everything changed in late 2010, when he went into the QTS warehouse and his boss told him he needed to trade in his truck and sign a lease-purchase contract.
For the next four years, he worked mind-numbing hours to pay the bills.
To save commuting time, he slept in his truck at work. To avoid bathroom breaks, he kept an empty two-liter bottle by his side. He became a ghost to his family.
Still, he had to drain his savings to survive.
A stack of weekly paychecks he keeps in a drawer at home shows his worst weeks. He grossed $1,970 on June 3, 2011, but it all went back to QTS. After the lease and other truck expenses, he took home $33.
On February 10, 2012, he took home $112 after expenses.
The next week, he made 67 cents.
Reyna got two office cleaning jobs and a third taking care of the elderly to try to make ends meet. Even so, when her father died, she couldn’t afford to fly home for the funeral.
Talavera was working so much, she said. “We didn’t understand why there was hardly any money left over.”
Through interviews and court records, reporters catalogued more than 120 drivers who say they regularly worked past exhaustion, 12 to 20 hours straight behind the wheel.
Federal law prohibits commercial truckers from driving more than 11 hours at a time, and they can’t work at all after 14 hours, until they have had 10 hours of rest. Government studies show that for every hour past 11 that someone drives, the chances of crashing increase exponentially.
Many drivers feel they have no choice but to take that risk.
On bad weeks-- when Flores hits traffic or gets assigned a low-paying delivery-- he says he takes home $300 or less for 100 hours of work. That translates into $3 an hour, less than a third of what he could make washing dishes at California’s minimum wage.
Drivers could quit and find new work. But many, like Flores, say they’ve stayed on hoping things would improve. Then they realized if they quit, they would lose thousands paid toward their truck. “They’re captive,” Teamsters’ international vice president Fred Potter said.
Truck payments can cut so deep into wages that drivers actually owe their employer come Friday.
“Working for free,” one driver called it in a court statement.
Paychecks read instead like weekly invoices: Faustino Denova, negative $9.64. Germen Merino, negative $92.50. Jose Covarrubias, negative $280.
For some truckers, the debt stacked up week after week, until they borrowed against their house or from friends, used their savings to pay it off or until their company fired them.
“The company didn't care whether I took a gallon of milk to my home or not,” one driver testified in a civil court case. “The company would take everything.”
Enough weeks like that put truckers into a hole they can’t escape.
Like many drivers, Talavera and his wife fell behind on their mortgage, and then stopped paying it altogether. They filed for bankruptcy to save their home.
In ways that happen in virtually no other workplace in America, port trucking companies in Southern California wield enormous power over their workers.
Through interviews and a review of sworn statements, the USA Today Network identified more than 100 drivers who reported threats and retaliation. Managers punish drivers most often for turning down the lowest-paying routes, missing work or refusing to work past federal hour limits.
At least 24 companies have fired drivers outright under those circumstances, according to interviews and a review of court, NLRB and California labor commission records. In each case, the driver lost his truck and what he’d paid into it.
Arcadio Amaya said he refused to work 15 hours straight one night at Pacgran Inc. and was fired the next day. He lost $26,400 he had paid toward a truck.
Armando Logamo, a former driver at RPM Harbor Services, said he saw other drivers bribing dispatchers for better-paying assignments, so he told his supervisor. The next week, Logamo was fired. He lost the truck, along with all the payments he had put into it.
“They fired me because I was one of the ones that was speaking up,” he said. “It was pretty devastating because I was with them for two plus years.”
Eddy Gonzalez once missed a day when he was called to court to testify as a witness. As punishment, he said his boss at Seacon Logix didn't let him work the next day.
Then, a few months later, he missed a week to bury his dead mother. When Gonzalez came back, he said, his boss cleaned out his truck and fired him on the spot while he pleaded to keep his job.
“He just took the keys and left,” Gonzalez testified in court.
Kia Hamadanchy is running for the Orange County congressional seat held by absentee congresswoman and Trump/Ryan rubberstamp Mimi Walters. Moments ago told us that "What's happening to these truckers is absolutely unconscionable and should have no place in any industry in this country. Companies shouldn't be allowed to trap their workers in these kinds of arrangements and situations like these are a big part of why I'm running for Congress and what I'd fight for once I get there." And the other excellent progressive running for the CA-45 seat is Katie Porter, who had the same reaction as Kia. She told us that "This is another example of how crushing, exploitive debt reveberates through people's lives and makes it almost impossible for many families to pull themselves up by their bootstraps. You should be able to work in this country to get yourself out of debt, but our financial and legal system has created an almost permanent class of debtors. Its why in Congress, I'll work to end credit checks for hiring and end employment discrimination based off consumer financial history."
Welcome to Republican Employee Management. We are but a single SCOTUS ruling away from making all workers indentured servants to their employers, with all of the controlling abuse that goes with it legalized. The only thing which would make this "arrangement" even more orgasmic for such employers would be the right to charge their employees for the right to work at all.
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