Iowa House panel advances liability protection for trucking companies

A year after a similar bill died on the floor of the Iowa House, Republican lawmakers are again advancing legislation to expand liability protection for trucking companies whose employees cause injury, death or other damages while on the job.

An Iowa House subcommittee on Tuesday advanced House Study Bill 114, which would put a $1 million cap on noneconomic damages against a trucking company in civil cases involving personal injury or death. Noneconomic damages might include pain and suffering, emotional trauma, loss of consortium of a spouse or similar claims.

Iowa Motor Truck Association lobbyist David Scott said the organization proposed the bill to “bring some fairness to nuclear verdicts around the country.”

“The legislation provides a level of predictability to all 804,000 commercial vehicles in Iowa — those are farm trucks, bread trucks, construction vehicles company-owned pickups — and it’s not about lowering insurance. It’s about to simply provide a known level of exposure,” Scott said.

The bill would also block claims against employers for negligence in hiring, training, supervising or trusting an employee, as well as some punitive damages. An employer would have to acknowledge the driver was an employee and acting in the scope of employment in order to receive exemption from some liability. The employer would still be liable for economic damages such as medical bills, loss of wages and property damage.

Numerous business and industry organizations, as well as insurance representatives, spoke in favor of the bill, while organizations representing attorneys were opposed.

Kellie Paschke, representing the Iowa Association of Justice, disputed that the bill was about providing a level of known exposure for trucking companies. “If that was true, this bill would just be about the million-dollar cap that’s in the bill. Instead, this bill is about protecting bad actors,” she said.

She said the bill would protect employers who fail to maintain vehicles or hire known drug addicts, or who make drivers work beyond their hours of service, causing fatigue that leads to accidents. “These are decisions that are made by employers, not the employees. And what this bill does is make the employee the scapegoat for the employers’ bad decisions,” Paschke said.

Representatives of attorney organizations said there have been no “nuclear” verdicts in Iowa and that insurance rates are competitive. Trucking companies argued that commercial supplemental or commercial umbrella policies are not affordable or accessible.

Rep. Sami Scheetz, D-Cedar Rapids, voted against advancing the bill. He said juries should be the ones to decide the value of a human life.

“For a long, long time in this state, we’ve been trusting our neighbors or peers to sit in the courtroom, listen to testimony and make that decision on behalf of everybody in the state. But for some reason, there’s a sentiment running through this building this week that we should take that right away from Iowans to decide this,” he said.

Republican Reps. Phil Thompson of Boone and Bill Gustoff of Des Moines voted to advance the bill to the House Judiciary Committee.

“So we all, obviously, just lived through a not-so-subtle reminder of how important that commercial motor vehicle industry is to not just our economy, but really our daily lives and everything we touch,” Thompson said. “I think it’s, frankly, unfortunate that every time a commercial motor vehicle is involved in an accident, some people see dollar signs …”

Republican lawmakers in both the House and Senate are also working to cap noneconomic damages at $1 million in medical malpractice cases. Gov. Kim Reynolds made that proposal a priority in her Condition of the State message.

The trucking company liability bill has faced roadblocks the past two years. In 2021, the bill did not reach the floor of either chamber. Last year, Republicans in the Iowa House tried to attach the bill to unrelated legislation on the floor, but the measure was defeated with 12 GOP votes against it.