Transportation Industry Class Action: Leasing Regulations & Employment Practices, Slides of Law

Download Transportation Industry Class Action: Leasing Regulations & Employment Practices and more Slides Law in PDF only on Docsity! Preparation in a Litigious Environment Docsity.com CLASS ACTION LAWSUITS I. OVERVIEW – ONSLAUGHT OF CLASS ACTIONS II. FEDERAL LEASING REGULATIONS CLASS ACTIONS III. EMPLOYMENT CLASS ACTIONS IV. QUESTIONS & ANSWERS Docsity.com B. ACCESS TO COURTS  STATUTE OF LIMITATIONS • 4 years: United Van Lines (8th Cir.); Landstar (11th Cir.)  CLASS CERTIFICATION • Most Cts. have certified a class, but not in Prime; Swift; United Van Lines; FFE • Class was decertified in Landstar Docsity.com C. LIABILITY (VIOLATIONS)  LEGAL STANDARD – § 14704(a) • Literal, not substantial, compliance – Landstar (11th Cir.); England (D. Utah) • But plaintiffs have to prove damages were “a result of” violation – Landstar; Swift • No liability without damages – Lund (Or.)  INSURANCE • Carrier pass-through of cost to o-o’s is lawful – United Van Lines (8th Cir.); Mayflower (S.D. Ind.) • Forced purchases unlawful – w.c. insur. (Rocor (W.D. Okla.); admin. fee (England); but not BI/PD insur. (Mayflower) Docsity.com C. LIABILITY (VIOLATIONS)  MARKUPS ON CHARGE-BACKS • Markups are lawful: No – Ledar Transport Yes – Landstar (11th Cir.), Swift (D. Ariz.), England, Davidson Bros. (Pa. Com. Pl.) Intermodal Container (Cal. Super.) • Markup amount must be in lease – England • Fact of markup must be in lease – Swift (D. Ariz.) • Must markup amount be in documents “afforded” at or after a settlement ? Yes – Landstar (11th Cir.). No – Swift (D. Ariz.) Docsity.com D. RELIEF TO BE AWARDED  DAMAGES UNDER § 14704(a)(2) • Detrimental reliance is test – Landstar (11th Cir.). Damages must be “as a result of” the violation – Fulfillment Svcs. and KPX (9th Cir.), New Prime (8th Cir.), England, Swift • No damages proven – Landstar, England, Swift, Davidson Bros. • Decert’n of class re damages – Landstar • Class cert. denied: Swift and FFE • $15.8 mil. in Truckers Express (D. Mont.) • Brinker (WD Wisc.) – Full amt. of chg.-back Docsity.com C. RELIEF TO BE AWARDED  RESTITUTION • No power under ICCTA to award – Landstar (11th Cir.); Swift (D. Ariz.) • “Damages” with restitution measure – Ledar • Restitution based on damages – England  SET-OFFS • Yes – Truckers Exp., Mayflower, Landstar (M.D. Fla.) • No – Arctic Express, Ledar • Yes if linked to ICOA – England Docsity.com C. RELIEF TO BE AWARDED  INJUNCTIONS • Prelim. injunc. – Yes (Ledar), No (Swift) • No permanent injunc. in England, Swift, but to be weighed on remand in Landstar  ATTORNEYS’ FEES • Statutory: Avail. to Pls. only – Fulfillment Svcs. (9th Cir.); New Prime (8th Cir.) • Common-fund: Generous in settlements Docsity.com E. PREVENTIVE STEPS 1. Update Independent Contractor Operating Agreement (Lease) 2. Update leasing affiliate’s equipment lease-purchase agreement 3. Maximize transparency and fairness Docsity.com E. PREVENTIVE STEPS 4. Points to focus on – a. Markups: In general; insurance b. Administrative fees c. Compensation: Disclosure (all elements; changes); follow-through d. Escrow funds: By any name; deductions e. Forced purchases: Avoid to reduce risk of Leasing-Regs. and i.c.-status lawsuits Docsity.com E. PREVENTIVE STEPS 5. Match practices to agreements’ terms 6. If OOIDA calls/writes, talk to a lawyer before responding Docsity.com A. CHALLENGE TO IC STATUS  CHALLENGE TO O-O’S I.C. STATUS • Right to control test • Actual exercise of control • Entrepreneurial risk test • Separate line of business • Customarily independent occupation Docsity.com B. EMPLOYEE DRIVERS  OF COURSE, IF CARRIER USES EMPLOYEE DRIVERS, PLAINTIFFS NEED NOT DEMONSTRATE RECLASSIFICATION Docsity.com C. WHO’S BEING SUED  INDUSTRY SEGMENTS • Small package • Courier • Last-mile delivery/home delivery • LTL • Truckload  PLAINTIFFS SUING LARGE AND SMALL CARRIERS Docsity.com D. CLAIMS AND DEFENSES  IMPROPER DEDUCTIONS/FAILURE TO REIMBURSE • Reclassified drivers  Insurance  Vehicle expenses (fuel, maintenance, repair)  Tools  Uniforms – Employee drivers  Tools Docsity.com D. CLAIMS AND DEFENSES  DEFENSES TO DEDUCTION AND REIMBURSEMENT CLAIMS – For reclassified drivers, award = a windfall.  Effect is to treat gross compensation as wages  Was compensation structure designed to effectively reimburse? – For employee drivers  Was tool necessary?  Was cost reasonable?  What did the employee do with the tool? Docsity.com D. CLAIMS AND DEFENSES  MINIMUM WAGE CLAIMS – Arises when compensation is activity-based.  Some claims based on wage averaging (e.g., driver paid on cents per mile, but stuck in all-day traffic)  Some claims based on assertion that driver performed activities outside the defined activity- based rate without compensation (e.g., fueling, detention, loading/unloading, completing paperwork, lay over) Docsity.com D. CLAIMS AND DEFENSES  DEFENSES TO OVERTIME CLAIMS • Motor carrier exemption from wage and hour laws  Parallel state law exemptions in some states • Extraterritorial application of state law (e.g., Washington) Docsity.com D. CLAIMS AND DEFENSES  MEAL AND REST BREAKS • California statute requires employers to “provide” specified meal and rest breaks  Claim -- failed to ensure breaks taken  Claim -- prevented employee from taking breaks  Claim – delayed breaks • Statutory penalty for missed breaks  One hour of pay for each missed break Docsity.com D. CLAIMS AND DEFENSES  DEFENSES TO MEAL AND REST BREAK CLAIMS • Driver elected to skip break(s) • Preemption  Obstacle to purpose of Federal hours-of-service regulations  “Related to a price, route, or service” Docsity.com E. CLASS CERTIFICATION  PLAINTIFFS ATTEMPT TO DEMONSTRATE UNIFORM POLICIES AND PRACTICES • Assertion -- all employees subject to uniform (i.e., same) policies and practices • Assertion -- damages can only be effectively recovered on behalf of class • Mixed results Docsity.com F. PREVENTIVE STEPS: INVESTIGATE STATE REQUIREMENTS  DETERMINE “TEST” USED TO DECIDE WORKER-CLASSIFICATION • Which state law applies? • Does test pose problems for your operation?  DOES STATE HAVE RECORDKEEPING OR WAGE STATEMENT REQ’TS? • Is information to be supplied captured? • Can information be included? • Are hours of work tracked? Docsity.com F. PREVENTIVE STEPS: INVESTIGATE STATE REQUIREMENTS  DOES STATE HAVE BREAK REQ’TS? • If so, institute written policy addressing requirements • Craft protocol to track taking breaks  DOES STATE RESTRICT DEDUCTIONS FROM WAGES? • Written authorization • For the benefit of the employee Docsity.com