XPO Logistics is appealing a California’s agency’s award totaling $855,286 to four truckers for wage law violations, including under a 2016 state law mandating compensation for “nonproductive time.”
California’s labor commissioner concluded the logistic giant’s subsidiary, XPO Cartage, had misclassified the truckers as independent contractors instead of employees. “Substantial evidence supports the finding that plaintiffs were functioning as employees rather than as true independent contractors,” it stated. On April 14, it ordered XPO to compensate them for meal and rest breaks, liquidated damages and interest.
XPO is appealing that decision to California’s superior court. “We know firsthand that the majority of owner-operators who serve our customers prefer to work as independent contractors, and we will continue to advocate for their right to do so,” it stated.
The carrier objected to the hearing, but otherwise did not participate, the agency noted. XPO maintained the state should compel arbitration to settle the issue, as stipulated in the agreements the truckers signed with the company.
The commission awards ranged from $171, 939 to $279,416 to compensate unpaid wages and penalties accumulated over three to four years of rail drayage in Los Angeles county. California requires employees take 30-minute meal and 10-minute rest breaks and be off-duty during these periods. However, the drivers testified they remained on-duty during breaks because of job pressure and being required to stay with the truck.
The order marked the first time a carrier was ordered to compensate truckers for nonproductive time after AB 1513 became effective on Jan. 1, 2016, said Justice for Port Truckers, a Teamsters union campaign. Most state lawmakers voted for the measure, designed to incorporate recent state appellate court decisions regarding piece-rate compensation. It mandated piece-rate employees receive compensation for nonproductive time described under AB 1513 and not related to federal hours-of-service for truckers.
The law requires piece-rate workers, including truckers paid per-mile or -delivery, receive no less than the applicable minimum wage for nonproductive time. XPO must compensate the drivers for inspecting trucks, scanning documents and waiting on dispatch, the court says. This is because they remained under XPO’s control during that time, even though not performing tasks directly related to activity being compensated on a piece-rate basis.
The state requires nonproductive time be compensated under the applicable California or municipal minimum wage. Some California city ordinances raised minimum wage higher than what the state requires. Piece-rate employees working in these cities must receive the local hourly wage when it is higher than the state mandates.
In recent years, numerous misclassification claims have been filed against XPO and several and other Southern California drayage companies with the commission, courts and the National Labor Relations Board.
