Delivery Drivers’ Underpaid Wages Lawsuit to Settle for $16.5 Million

U.S. District Judge William H. Orrick signed an initial approval on a $16.5 million truck driver underpaid wages lawsuit filed against XPO Logistics, according to a Law360 article posted on June 28, 2019. The original case was filed by Ron C. in 2016 as a proposed class action which included other delivery drivers denied appropriate wages and overtime associated with non-exempt employee status.

The complainant claimed that he and his colleagues were misclassified as independent contractors while they in fact were controlled by the transport giant in a manner identifying them as de facto employees. Ron C. and fellow plaintiffs allege they were underpaid wages on a straight hourly and overtime basis due to this denial of their actual employment status.

XPO Allegedly Ran the Show

According to the plaintiff, XPO stipulated how the delivery drivers were to go about and tackle their workload from day-to-day. The company reportedly had rules regarding what the drivers had to wear as a basic uniform during working hours, and the locations where they could drop off or pick up goods. Additionally, they were instructed by management how to install appliances step-by-step, the plaintiff claimed.

The Difference Between an Independent Contractor and an Employee

As indicated in an article posted by The Balance, the difference between an independent contractor and an employee boils down to three areas—the type of relationship they have with the company, what kind of behavioral control the company exerts over the individual worker, and what kind of financial control the company exerts of the same.

The type of behavioral control described in the Law360 article and attributed to the plaintiffs–where a clothing was prescribed as well as the “how to” minutia of accomplishing the work–is indicative of an employee. A factor used to determine if a company exerts financial control is whether it stipulates when and how the worker will get paid.

Other questions posted by The Balance article include, “Is the worker stopped from taking on other contract jobs while working for main employing entity?” and “Is the worker shielded from the ups and downs of company profit and loss cycles?” If the answer to both of these questions is yes, the person fits the mold of an employee and not an independent contractor.

The Underpaid Wages Lawsuit and Federal Aviation Administration Authorization Act

According to Law360, the defendant in this class action lawsuit argued before a federal judge during the certification of the action that wage order claims are disallowed under the Federal Aviation Administration Authorization Act. This alleged disallowance presented some risks to seeing the litigations through to the end and encouraged coming to a settlement.

The Federal Aviation Administration Authorization Act, as indicated by Truckstop.com, was passed in 1994 and ruled that the federal government should oversee wage and hour issues when it comes to truckers that may cross several state lines in one day.

This stands opposed to having to adhere to the wage and hour laws as they vary from state to state. Having to follow each state’s stipulations rather than an overarching law was believed to impinge upon the profit and functionality of interstate commerce.

The XPO settlement is supposed to recover $70 per day worked for close to 850 delivery drivers that have worked since 2012. This amounts to an average individual yield of $14,000.

The XPO Logistics Lawsuit is Case No. 3:16-cv-01231, in the U.S. District Court for the Northern District of California.

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