California Labor Law Class Action Moves Forward

Kevin Anderson Employment and Labor, Judgments, Regulations, Transportation

Certain FedEx line-haul drivers were certified as a class by a federal judge recently in their suit to be compensated under California’s labor laws related to breaks, unpaid work, and other violations. In Taylor v. FedEx Freight, Inc., Case No. 13-cv-1137-LJO-BAM (E.D.Cal. 2015), the court granted the plaintiff’s motion for certification, and the case will proceed as a class action lawsuit for violation of state labor laws.

This ruling comes on the heels of a lawsuit against FedEx for misclassifying employees as independent contractors under California’s labor laws. That case settled out of court for $228 million. Both of these suits should serve as a cautionary tale for trucking companies and how they deal with state labor laws in the ever evolving legal landscape involving delivery companies.

History of the Case

This case involves line-haul drivers who have worked for FedEx since 2012 in California. Their complaint surrounds how the company’s compensation system interacts with California labor laws. Under the company’s compensation system, line-haul drivers are paid by the mile for the freight that they deliver. According to the company, that system necessarily includes compensation for things like break and non-driving work such as placarding, paperwork, and inspections.

But at least some of the company’s drivers disagree. Their main complaint is that because they are paid by the miles they drive, they are not given the paid breaks required by California law, and they are not paid for non-driving work that they are required to do by the company.

Laws Affecting Driver’s Claims

California Labor Code §§ 1194, 1197, 226.7 requires companies to compensate their employees for all the time they are required to work, and provides that employees are entitled to a certain amount of paid breaks every day. The line-haul drivers in this case are seeking back-payment for all the time they worked since 2012 but were not paid as required by the state’s law.

While the company rejected these claims for unpaid work, they further argued that the Federal Aviation Administration Authorization Act preempts the claim. The FAAAA preempts state laws that deal with motor carrier’s routes, prices, or services. But, as the judge pointed out in his opinion, under recently decided 9th Circuit law, the FAAAA does not apply to a state’s meal and rest break laws. That recent development in the 9th Circuit will change how interstate companies deal with state labor laws within the 9th Circuit Court of Appeals’ jurisdiction.

State Labor Laws Continue to Affect Interstate Trucking Companies

This case and others that continue to be filed against trucking companies should put the industry on notice. State labor laws do affect how trucking companies do business from state to state, and it is important to stay up-to-date on all of the developments. Not understanding how state laws interact with federal laws, and how both are being interpreted by the courts, could land a company in a deep financial mess.

At Anderson and Yamada, P.C., our practice is dedicated to understanding and applying developments in trucking laws to help your company thrive and grow. Contact us so we can serve you and your company.