In the case of Carter et al v. XPO Logistics, Inc., a class of 832 current and former delivery drivers in California filed a lawsuit against XPO Logistics for misclassifying them as independent contractors instead of employees. The plaintiffs alleged that this misclassification allowed the company to avoid paying overtime wages and other employment benefits under California labor laws.
Despite the drivers having signed Delivery Service Agreements identifying them as independent contractors, the court found that the degree of control XPO exercised over their work aligned more with employee status. Factors included the company’s oversight over routes, scheduling, and performance expectations, which contradicted the drivers’ supposed independence.
In June 2019, a federal court in California granted preliminary approval of a $16.5 million settlement, compensating the drivers for unpaid wages and related damages.
Key lessons from this case:
- The classification of workers depends more on the nature of the working relationship than on contractual labels.
- Companies exercising significant control over independent contractors may be liable under wage and hour laws.
- Large settlements can result when companies fail to properly classify and compensate their workforce.
If you want to know more about overtime regulations, read our guide on California Overtime Laws.
