J.B. Hunt wage lawsuit settles for $6.5 million
July 23, 2020
A few hundred J.B. Hunt drivers have asked a federal court to approve of a settlement worth $6.5 million in a California misclassification wage lawsuit.
On July 6, plaintiffs in the class submitted a motion for preliminary approval of a settlement. If approved, J.B. Hunt will pay out $6.5 million to 312 truckers, netting each driver about $20,000.
The lawsuit is a classic case of misclassifying truckers as independent contractors. J.B. Hunt intermodal drivers in California paid for a variety of expenses they argue should have been paid for by the company if properly classified as employees. Per California law, an employer must satisfy the standard of an independent contractor:
- Worker is free from the control and direction of the hirer in connection with the performance of the work, both under the contract for the performance of such work and in fact.
- He or she performs work that is outside the usual course of the hiring entity’s business.
- Worker customarily engages in an independently established trade, occupation, or business of the same nature as the work performed for the hiring entity.
The amended complaint alleged that J.B. Hunt has significant control over the truckers’ schedules, routes, deliveries and the manner and means of how the delivery work is performed. Also, the truckers’ attorneys claimed that truck driving “is not an independently established trade, such as a plumber or electrician.” Rather, truckers are integral and central to the operation of J.B. Hunt’s core business. Lastly, the lawsuit claimed that the company prevents drivers from using their trucks for any purposes other than J.B. Hunt’s business.
After stating their case regarding employment status, the lawsuit pointed out several expenses that should have been the responsibility of J.B. Hunt.
All drivers had to purchase or rent an on-board computer from J.B. Hunt for the purposes of dispatch and tracking. The company also had full discretion to modify or end piece-rate compensation rates and fees. Insurance was also the responsibility of the driver. Furthermore, drivers had to pay for fuel, oil, tires/equipment, vehicle maintenance costs and repairs, various taxes and assessments, and expenses necessary to keep their trucks in compliance with all federal and state safety laws and regulations.
In addition to costs incurred, drivers also asked for compensation from lost wages. The lawsuit claims J.B. Hunt failed to provide meal and rest periods.
The lawsuit alleged nine counts against J.B. Hunt, including:
- Failure to pay minimum wage.
- Failure to reimburse for necessary business expenses.
- Improper deductions from wages.
- Failure to provide meal and rest breaks.
- Failure to provide accurate, itemized wage statements.
- Unfair competition.
- Unjust enrichment.
According to preliminary settlement documents, total damages were estimated to be more than $26.8 million, including nearly $9 million in lost wages and nearly $18 million in expenses. The vast majority of business expenses came from fuel:
- Fuel purchase: $15 million.
- On-board computer use: $212,000.
- Bobtail insurance: $161,091.
- Occupational accidental insurance: $959,953.
- Physical damage insurance: $725,134.
- Tire maintenance: $436,886.
- Tractor maintenance: $286,174.
- Road service administration charge: $12,880.
Settlement documents claim J.B. Hunt’s total exposure before calculating the risks of a class action was close to nearly $31 million. That risk factor reduced the assessment by half to more than $15 million. Eventually, the agreed-upon settlement became $6.5 million.
By settling, J.B. Hunt does not admit any wrongdoing and denies all allegations.
If the court denies the settlement, both parties will go back to the drawing board.
Originally filed in federal court in February 2019, this case was resolved in a relatively short amount of time. In November 2018, J.B. Hunt settled another California wage lawsuit for $15 million. That case was in litigation for more than a decade.