YOUR INDEPENDENT CONTRACTOR DRIVERS MAY COST YOU

A recent state’s Superior Court ruling upheld the state’s Labor Commissioner’s decision that drivers working for JOHN DOE TRUCKING (not its real name) were not independent contractors but company employees. 

The owner of JOHN DOE TRUCKING claimed the decision was “very, very unfair”. 

This did not stop the court from requiring JOHN DOE TRUCKING to pay violation costs of over $100,000 despite their claim that drivers had signed agreements declaring themselves independent contractors.

The case originated from wage claims filed by four drivers with the Labor Commissioner’s office. The drivers claimed unreimbursed business expenses and unlawful deductions, including weekly truck rental fees and liability insurance costs for the JOHN DOE TRUCKING trucks they drove for the company. Hearings on the claims resulted in a decision requiring JOHN DOE TRUCKING to pay $105,089.15 for violations including unlawful withholding of wages, interest and waiting time penalties.  JOHN DOE TRUCKING appealed the hearing decision with the state’s Superior Court.

The state’s Superior Court ruling upheld the labor commissioner’s hearing decision and ordered JOHN DOE TRUCKING to pay $107,802, including interest. The drivers will get the full amount of that award.

“In this case, drivers had signed agreements labeling them independent contractors but the court saw the truth behind the label,” the court said in a statement. “The court found that the company exerted sufficient control over the drivers such that the drivers were employees of the company and thus, enjoy all basic labor law protections.”

The perceived protections afforded by labeling drivers independent contractors – when they are not – are coming to an end.

If JOHN DOE TRUCKING had elected instead to outsource their drivers with Pro Source, Inc, all wage and tax issues would have been properly addressed.  Consider outsourcing as a low cost, convenient way to stay in legal compliance of all federal and state wage and hour laws, while still maintaining reasonable oversight of your transportation operation.  Or continue to put yourself at unnecessary risk.

About Douglas Mills

Douglas Mills writes for Third party logistics company, Pro Source Inc of Atlanta, GA.
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