Company Settles Suit by Delivery Drivers Forced to Pay for Damaged Merchandise
Nearly five dozen delivery drivers have reached a preliminary $233,450 settlement in their class-action lawsuit, which alleged NEHDS Logistics misclassified them as independent contractors, not employees.
January 07, 2020 at 06:06 PM
3 minute read
A group of Connecticut plaintiffs drove home a hard lesson on worker classification to a company with which they reached a more than $230,000 settlement.
The plaintiffs sued NEHDS Logistics LLC over allegations it improperly classified drivers as independent contractors instead of employees, a move that allowed it to charge them for merchandise damaged in transit.
The Bethel-based company reached a preliminary $233,450 agreement to settle a class-action lawsuit against it in Brian Poli, Juan Crespo and Carlos Cosme v. NEHDS Logistics.
Superior Court Judge Thomas Moukawshers granted preliminary approval of the settlement Dec. 17, with a final resolution expected Feb. 5.
NEHDS delivers retail merchandise on behalf of companies such as Bob's Discount Furniture, Costco Wholesale Corp., and Ashley Furniture HomeStore.
Plaintiffs claimed that as independent contractors, delivery drivers had been paying out of their own pockets for damaged and missing goods, an expense they would not have to incur if NEHDS Logistics classified them as employees.
The case turned on whether the court agreed they were employees, not contractors.
Plaintiff attorney Michael Petela Jr. of Hartford-based Hayber, McKenna & Dinsmore Tuesday said he believes the Connecticut General Statute clearly defines "employee" or the defense would not have agreed to the preliminary settlement. Plaintiffs argued the alleged misclassification turned into $252,113 in deductions taken from the compensation of those drivers.
Petela said those wage deductions should not have happened because Connecticut General Statute 31-71e prohibits the drivers, if classified as employees, from incurring the cost of reimbursing customers.
The class-action lawsuit, filed in Hartford Superior Court in August 2017, lists several examples of why the drivers should be classified as employees. The most striking example, Petela said, "was that the drivers had a restrictive covenant in their agreement that limits their ability to be independent."
"That covenant says the drivers cannot compete against the defendant in a geographic area that ranged from New Hampshire to South Carolina," the attorney said. "Right there, that tells me they cannot be truly independent."
Assisting Petela is his colleague Richard Hayber.
The class covers drivers who worked for the company from Aug. 11, 2015, to the present. Petela said 40 of the 55 drivers in the class are slated to receive money, with the highest amount of $43,000 going to one driver. Under the terms of the preliminary agreement, the money will be disbursed in two separate payments to the drivers, in June 2020 and January 2021. Petela said 10 drivers will not get any money because "in any class action there are people who did not work enough hours to really have a claim."
Defense counsel Gabriel Dym and Geraldine Cheverko of Eckert Seamans in Boston declined to comment on the matter Tuesday.
But in court papers, the defense gave several arguments. Among other claims, it argued the plaintiffs failed "to assert an ascertainable loss," and that the company's "personnel policies do not offend public policy."
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