From JDSupra, Richard Reibstein discusses a case in Massachusetts in which a logistics company settled the misclassification claims by delivery drivers. Richard writes:
LAST MILE LOGISTICS COMPANY SETTLES MASSACHUSETTS DRIVERS’ IC MISCLASSIFICATION CLASS ACTION FOR $2.9 MILLION. A federal district court in Massachusetts preliminarily approved a $2.9 million misclassification class action settlement between 145 drivers and a last mile delivery, logistics, and transportation company. In their class action complaint filed in 2018, the drivers asserted that the company misclassified them as independent contractors instead of employees and that the deductions taken by the company from their pay, particularly deductions for customer damage claims and insurance coverage, violated the Massachusetts Wage Act. The company contended that the contested deductions were valid. Over the past six years, after the case transferred from state to federal court, a class was certified, and the court granted the drivers’ motion for summary judgment on the issue of the company’s liability as an employer under Massachusetts’ ultra-strict ABC test, the parties reached a settlement agreement last month, just prior to the date set for a trial on damages. The settlement amounts to approximately 66% of class members’ alleged damages, net of attorney’s fees. The largest payment to a class member would exceed $50,000.00, while the average payout will be approximately $12,000. The parties agreed to attorneys’ fees and costs of administration just short of one million dollars. The settlement agreement recites that the Company continues to deny all charges of wrongdoing or liability, but has settled to avoid additional legal fees. A final approval hearing is set for September 11, 2024. Muniz v. RXO Last Mile Inc., No. 4:18-cv-11905 (D. Mass. June 24, 2024).
