The Federal Government Shouldn’t Make it Harder to Work for Yourself
The Story
Cully Frisard grew up trucking and has been with it through the ups and downs of the pandemic when his drivers were heroes who provided people essential supplies. He now operates, Frisard’s Transportation, L.L.C., a family-run trucking company based in Gramercy, Louisiana. Specializing in delivering goods across the southern and eastern United States, Frisard’s has built its business model around using independent contractors as drivers. These drivers, who own their trucks and manage their schedules, are crucial to Frisard’s operations, allowing the company to efficiently manage costs and maintain flexibility in its service offerings.
However, a new rule issued by the U.S. Department of Labor in 2024 has put this business model at risk. The rule changes the criteria for classifying independent contractors, introducing a vague balancing test that replaces the previous clear guidelines. This shift threatens to disrupt the way Frisard’s operates, potentially forcing the company to reclassify its independent drivers as employees, which would significantly increase operational costs and reduce the autonomy that these drivers currently enjoy.
And the rule affects far more than the 350,000 owner-operator truckers that operate across the nation. It will affect 70 million freelancers in industries across the country, pushing them towards an employment status when 80% of them want to be independent. Similar legislation in California led to a loss of over 10% of freelancers.
With the help of the Pelican Institute, Frisard’s has filed a lawsuit against the Department of Labor, arguing that the new rule is arbitrary and exceeds the department’s statutory authority. The company asserts that the rule undermines the certainty businesses and independent contractors need to operate efficiently and is inconsistent with the Fair Labor Standards Act and precedent set by the U.S. Supreme Court and the Fifth Circuit.
The lawsuit is more than a legal battle; it represents a crucial defense of the business model that has allowed Frisard’s and similar companies to thrive. It’s a fight to maintain the entrepreneurial freedom that is essential to the trucking industry and the broader independent contractor community. By challenging the Department of Labor’s rule, Frisard’s is standing up not just for its own business and its contractors but also for the principle of maintaining freedom, opportunity, and the American dream.
The Latest
On June 17, 2024, Pelican Institute and the Liberty Justice Center filed their opening appellate brief.
The Timeline
Complaint. On February 8, 2024, the Pelican Institute and the Liberty Justice Center filed a Complaint on behalf of Cully’s company challenging the rule.
Amended Complaint. On March 7, 2024, the Pelican Institute and the Liberty Justice Center filed an Amended Complaint adding additional trucking company plaintiffs to challenge the rule.
Motion for a Temporary Restraining Order and Motion for Preliminary Injunction. On March 7, 2024, the Pelican Institute and the Liberty Justice Center filed a Motion for a Temporary Restraining Order and a Motion for a Preliminary Injunction to block implementation of the Rule while the litigation was pending.
Telephonic Conference. On March 8, 2024, a telephonic conference was held. The district court denied the motion for a temporary restraining order and motion for a preliminary injunction.
Interlocutory Appeal. On April 8, 2024, Pelican Institute and the Liberty Justice Center filed a Notice of Appeal, appealing the denial of the temporary restraining order and motion for a preliminary injunction to the Fifth Circuit.
Appellants’ Opening Brief. On June 17, 2024, Pelican Institute and the Liberty Justice Center filed their opening appellate brief.
Amicus Briefs. On June 24, 2024, several other organizations filed amicus briefs in support of the appeal. These included Americans for Fair Treatment, Institute for the American Worker, and the Manhattan Institute; Business Trade Associations (including Chamber of Commerce of the United States of America, Coalition for Workforce Innovation, Associated Builders and Contractors of Southeast Texas, Inc., Associated Builders and Contractors, Inc., Financial Services Institute, Inc., National Federation of Independent Business, Inc., National Retail Federation, and American Trucking Associations); and the Buckeye Institute.
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