PepsiCo reaches $5 million settlement in trucker wage theft lawsuit

Truck drivers at the center of a class action wage lawsuit against PepsiCo are waiting for approval of a preliminary settlement, according to California federal court documents. If granted, PepsiCo will cough up $5 million for failure to pay overtime and work done during lunch and rest breaks.

On June 22, attorneys for a class of PepsiCo truck drivers submitted a motion for preliminary settlement approval in a lawsuit that was originally filed in March 2017. According to court documents, Purchase, N.Y.-based PepsiCo has agreed to a $5 million settlement for approximately 1,800 drivers employed between Jan. 25, 2013, and the date the court issues an order preliminarily approving the settlement.

If each class member participates in the settlement, each driver will receive an average of nearly $2,000, totaling $3.58 million of the $5 million settlement. Attorneys will collect 25 percent of the settlement, or $1.25 million. The settlement administer will receive up to $25,000.

Typical in class action lawsuits, the named plaintiff receives an enhancement payment, also known as a general release payment. These payments award the named plaintiff more than the class members and typically are not part of negotiations. In this case, Nathaniel Helton, the named plaintiff, will receive no more than $7,500. Helton’s attorneys appear to be unsatisfied with that amount, considering what he has sacrificed.

In the motion for approval, attorneys for Helton pointed out the risk Helton was taking by pursuing the lawsuit. Helton’s attorneys mention that in today’s “computer, high-tech age” employers tend to Google or otherwise do extensive background checks with access to court databases to see if a potential employee, such as Helton, has ever filed a lawsuit.

“Here, plaintiff’s conduct will not be lost on a prospective employer who has to choose between an applicant who has never sued an employer and one who has done so,” Helton’s attorneys wrote in their motion. “The requested award far from compensates plaintiff for opportunities he may lose in the future because of the exercise of a constitutional right to petition the courts for redress of a grievance.”

Helton v PepsiCo
On March 6, 2017, Helton filed the lawsuit against Pepsi-Cola Sales and Distribution along with New Bern Transport, PepsiCo’s trucking company. The lawsuit alleges PepsiCo failed to compensate drivers for time worked, including lunch breaks, rest breaks and overtime.

According to the lawsuit, PepsiCo had a consistent practice of clocking out drivers for 30-minute meal periods, even though drivers often times worked during those periods. Drivers were also required to work for over four hours without a 10-minute rest period, which violates California state labor laws. California law also requires employers to pay employees one hour of pay for each day a rest period is not provided, which the lawsuit alleges PepsiCo failed to do.

Furthermore, the lawsuit alleges that PepsiCo failed to timely pay wages owed to drivers who left the company or were terminated.

Another allegation includes the failure to reimburse drivers for the use of cellphones for work duties. PepsiCo policy required that cellphones be turned on at the beginning of a shift and remain on until the end of a shift. Although cellphones were provided by the company, the lawsuit alleges expenses to the drivers because of “electricity costs for having to charge company equipment and phones at their residences.”

Plaintiffs drove tractor trucks pulling delivery bay trailers. Drivers were paid an hourly rate.