Costco ditches trucking company over driver abuse allegations

It isn't clear whether the company will survive the fallout from a year-long USA Today investigative report.

Costco Wholesale will no longer do business with a California port trucking company accused of serious labor violations committed against its drivers.

Costco Cuts Out Pacific 9 Following Driver Exploitation Allegations

According to a report in USA Today, Costco has cut ties with Pacific 9 Transportation following the publication of a year-long investigative report detailing the alleged exploitation of port truck drivers.

Other companies also seem poised to dump the port trucking companies accused of abuse in the report. Hewlett-Packard has reportedly sent in an investigator to look into Pacific 9’s labor practices. Walmart has publicly vowed to cancel contracts with trucking companies that do not comply with labor laws.

Report Details Predatory Lease Purchase Programs, Dangerous HOS Violations

In the report, which was published in June, drivers made explosive claims about how they were driven into debt and forced to work as many as 20 hours per day by predatory trucking companies. The report argues that the port truck drivers — who often don’t speak much English — are duped into lease purchase programs that place the drivers so deeply in debt that they become “indentured servants”.

On July 31, a group of Democratic senators who were concerned by the report sent out a letter to sixteen large corporations including Walmart and Target demanding that they investigate the alleged driver labor abuses.

While the news of Costco’s decision to drop Pacific 9 may be seen by some as a victory for truckers, other truckers are concerned about what they might suffer if Pacific 9 is forced to close.

Trucking Company Claims To Have Made Reforms — Too Little, Too Late?

Pacific 9 filed for bankruptcy protection in 2016 in the wake of an employment classification lawsuit that cost them $7 million, and since that time has reclassified many drivers as employees instead of as independent contractors.

Pacific 9 and many of its drivers say that the company has ended exploitative practices and that continued pressure from the fallout from the USA Today piece could spell the end for the beleaguered trucking company, leaving drivers empty-handed and out of work.

As of 2016, Pacific 9 employed about 75 drivers.