A long awaited change in the truck driving industry may finally come to fruition.
A group of more than 400 immigrant Latino and Korean truck drivers recently settled a class action lawsuit filed against a Southern California port trucking company comprised of intertwined corporate entities, challenging the traditional model of treating direct hire drivers as independent contractors. The lawsuit alleged the employers were illegally deducting expenses from their drivers’ paychecks to cover fuel, vehicle lease payments, insurance, and maintenance.
The settlement could be a key victory for truck drivers in their never ending battle to hold companies responsible for treating direct hires as if they were employees, not contractors or freelancers. Truck drivers throughout the country are hoping the settlement prompts a radical change in the trucking industry and business model, which has historically compensated them as independent contractors.
The lawsuit asserted that the collection of named trucking companies illegally deducted around $1,500 from each of the drivers’ paychecks, resulting in a payment under minimum wage. The named plaintiff in the action, Mariano Alexander Saravia, reported to work 14 hours per day from Monday through Thursday, and six hours a day on Saturday. At the end of each week, his employer routinely subtracted from his paycheck $1,000 for diesel fuel, $415 in truck lease payments, $130 for insurance and $35 for the cost of tires.
On one occasion in December 2012, Saravia was left with a paycheck of $1, despite working some 48 hours of work during the week. The unacceptably low and inadequate paycheck stuck in his mind, but he had a real difficult time purchasing Christmas gifts for his two daughters, stating:
“I felt really badly, because what could I have bought my daughters with $1? If I had gone to the 99-cents store to buy something for my girls, I could have only have bought one of them a gift.”
Despite the positive news of the settlement, the drivers’ union delegates remain skeptical of universal change. “It doesn’t change anything,” said Barb Maynard, a spokeswoman for the Teamsters Union that advocates on behalf of port truck drivers. “The clock starts again the minute the settlement is over. The misclassification is continuing.”
By classifying the drivers as independent contractors but controlling them like employees, companies are able to evade taxes as well as shift operating costs of the business onto the drivers. At Harford, P.C., we are hopeful that the settlement will not only set precedent for employer-employee relationships, but also strike a change in policy and direction for truck drivers across the country to be treated as employees. And, most importantly, that they be more adequately compensated and reimbursed by their employers for their legitimate expenses.
The Los Angeles Superior Court will hear the Plaintiffs’ motion for preliminary approval of the class settlement on August 12, 2016.
