Misclassification complaint reaches class action status in decade-old lawsuit

A group of truckers can proceed with its wage lawsuit against Sleepy’s LLC as a class action after a federal appeals court reversed a lower court’s decision to deny a motion for class certification, further delaying a 10-year-old lawsuit.

On Sept. 9, a panel for the Third Circuit Court of Appeals reversed a New Jersey district court’s denial of a renewed motion for certification for truckers involved in a lawsuit against Hicksville, N.Y.-based mattress company Sleepy’s. Drivers accuse the company of misclassifying them as independent contractors.

Truckers for Sleepy’s had sought class certification for drivers who met the following criteria:

• Worked full-time making deliveries and were misclassified as independent contractors.
• Were subject to improper deductions.
• Worked more than 40 hours per week without being paid overtime.

Nearly 200 drivers meet the criteria, according to court documents. However, the court found that identifying class member requires specific fact-finding for each individual driver. The motion for certification was denied, with the court pointing to the “ascertainability” of identifying members.

Plaintiffs filed a motion for reconsideration by reducing the proposed class to just over 100 drivers. Updated criteria includes drivers who performed deliveries under an independent contractor agreement in New Jersey as early as March 2004. Also, the class consists of single-route operators who worked for Sleepy’s a minimum of six months.

Again, the district court denied the motion for certification. The court argues Sleepy’s records, or lack thereof, would make it nearly impossible to ascertain who qualifies as a class member.

The Third Circuit panel disagreed.

Essentially, the appellate court argues that drivers should not be punished for Sleepy’s lack of record keeping.

“Sleepy’s argues that it acted in good faith when it failed to keep complete records for the proposed class members because it believed they were independent contractors and not employees,” the Third Circuit stated. “If we accept this argument and allow appellants’ class action to be thwarted by Sleepy’s lack of records, we would be creating an incentive for employers not to keep records and thus avoid potential lawsuits. We thus would be crafting a vast loophole to class certification; employers could simply argue that they believed the potential class members were not employees. This would lead to paradoxical outcomes.”

Initially filed in March 2010, the lawsuit is a classic misclassification case between drivers and Sleepy’s. The amended complaint claims that drivers had to sign an “independent driver agreement,” which required them to buy or lease vehicles, pay for maintenance, fuel and insurance, and absorb other operational costs typically paid by employers. Consequently, drivers were denied unemployment and workers’ compensation insurance, benefits, and overtime pay.

According to the complaint, drivers do not work for Sleepy’s “from time to time,” on a nonexclusive basis. Rather, they work full-time for the company, are required to wear Sleepy’s uniforms, adhere to its grooming standards, and must display Sleepy’s advertising on their vehicle upon its request. Furthermore, drivers are not involved in negotiations between Sleepy’s and its customers over pickup, delivery times and other requirements.

“There is no independent entrepreneurial opportunity for the drivers and no business to grow,” the lawsuit claims. “The drivers have no proprietary interests; therefore, the drivers do not own a route and their income is totally dependent upon their delivery schedule that is completely controlled by Sleepy’s.” LL