February 26, 2018

California cartage drivers sue XPO, charging employee misclassification

Class action says company fully controls cartage drivers, but labels them independent contractors.

By DC Velocity Staff

Cartage drivers in California filed a class-action lawsuit today against transport and logistics giant XPO Logistics Inc., alleging the company misclassifies the drivers as independent contractors in order to save money, when in reality the drivers are XPO employees entitled to the benefits that come with that status.

The suit, filed in Superior Court in Los Angeles, alleged that XPO committed "wage theft" through its improper classification of drivers. The suit also charged the company with violating drivers' rights as employees, including failing to properly compensate drivers for missed meal breaks and rest periods.

The class currently consists of 160 members, although Julie Gutman Dickinson, an attorney for the class, said she expects that number to grow. The size of the monetary damages will definitely be in the seven-figure range, though the amount will vary depending on a number of factors, Dickinson said.

In a statement, XPO said the "vast majority of port drivers want to maintain their independence as contractors." The company vowed to "continue to defend this business model." A source said that XPO exclusively uses contractor drivers to perform port and rail cartage services in California, and that in a tight market for qualified drivers, anybody seeking full-time employment shouldn't have trouble finding it with other cartage companies, or with trucking firms in California and elsewhere.

In a sharply worded e-mail, Dickinson called XPO's classification argument "a sham and a fiction." The contractor agreement that drivers "are forced to sign aren't worth the paper that they are written on—they are 'take it or leave it' agreements that drivers have to sign if they want to work," she said.

Noting that state courts and agencies have found that XPO Cartage drivers are, in reality, employees, Dickinson said that "it's not what's in the agreement that matters—it's the actual terms and conditions of employment of their actual work life that matter for determining employee status."

In the filing, the driver group alleged that XPO requires drivers to submit to mandatory drug and alcohol tests, and to conduct daily truck inspections subject to "suspension and even termination" for disobedience. In addition, XPO performs extensive background checks and employee eligibility verifications on each driver, including credit and criminal histories and a lookback on prior employment, according to the suit.

This behavior is characteristic of a company that is in significant control of its cartage drivers, according to the suit.

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