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Oliveira v. New Prime, Inc.

Oliveira v. New Prime, Inc.

The story is becoming ever more common in the trucking industry: A large trucking company advertises something like “Become a trucker! Make a solid middle-class income!” And workers looking for decent jobs take the company up on its offer. They learn to drive a truck, get their commercial driver’s license, and live on the road hauling freight for the company, only to find that the solid middle-class income they’ve been promised is nowhere to be found—that, in fact, the company is taking money out of their workers’ paychecks to pay the company’s business expenses. But the workers can’t leave because the company claims that if they do, they’ll owe thousands of dollars for training and equipment they can’t possibly pay back. And if the workers try to sue the company for the wages they’re owed, the company will fight hard to prevent the case from even getting to court in the first place.

This is precisely what Dominic Oliveira alleges happened to him—and numerous other truck drivers at New Prime, Inc. Prime is a national trucking company that recruits workers by advertising a “paid apprenticeship” in which new recruits haul goods alongside experienced Prime drivers. Federal regulations limit the number of hours one person may drive in a single stretch, so by putting two drivers in each truck, Prime’s apprentice program allows Prime trucks to remain on the road for longer periods of time—and therefore to operate more efficiently and competitively.

Prime, however, does not pay its “apprentices” for their work. In fact, Prime actually charges drivers to work as “apprentices”—debt that’s only forgiven if a driver works for the company for at least a year.

Dominic first joined Prime through its apprenticeship program. Like other “apprentices,” Dominic was required to complete 10,000 miles hauling freight for Prime, and yet was paid nothing for his work. And even once he completed his “apprenticeship,” he still earned far less than minimum wage. Prime next required him to complete another 30,000 miles for the company as a “driver trainee,” for which he was paid only 14 cents per mile spent on the road—about $4 an hour—and nothing at all for other work like loading and unloading the truck.

Dominic’s situation only worsened once he became a full-fledged Prime driver. Although Dominic performed the same work as drivers Prime admits are employees of the company, Prime classified him as an independent contractor. It then required him to lease his own truck (from a company owned by the same people who own Prime), to buy his own equipment (from the Prime store), and to pay for his own fuel (often at the Prime gas pump). Prime charged Dominic for all of this—thousands of dollars the company would ordinarily have to pay to conduct its trucking business taken out of its worker’s paycheck. Because of these deductions, on several occasions, Dominic’s paycheck was actually negative—that is, Prime sometimes charged Dominic to work for the company.

And, Dominic alleges, his experience is not unique. A huge number of other Prime drivers could tell the same story. In March 2015, Dominic filed a lawsuit against Prime on behalf of himself and thousands of current and former Prime drivers who have been misclassified as independent contractors and underpaid just like him.

Prime is attempting to force this lawsuit out of court and into arbitration. Like many trucking companies nowadays, the contract Prime requires that many of its drivers sign to work for the company contains an arbitration clause, which states that drivers may not sue the company in court. The company argues that the Federal Arbitration Act requires courts to enforce this arbitration clause and kick Dominic (and the other drivers whose wages he’s fighting for) out of court. But, by its terms, the Federal Arbitration Act does not apply to the “contracts of employment” of transportation workers. And truck drivers, of course, are transportation workers. The company argues that it can get around this exception because it labels its drivers “independent contractors.” But the history of the Act—and the ordinary meaning of its terms at the time it was passed—makes clear that it exempts all transportation workers, regardless of how their company labels them. In May 2017, the First Circuit Court of Appeals, the first appellate court to consider the issue, agreed. The case is now before the U.S. Supreme Court. Public Justice is hopeful that, like the First Circuit, the Supreme Court will apply the law as it was written: as exempting all transportation workers.

  • Jennifer Bennett
  • Victoria W. Ni of Public Justice
    Andrew Schmidt of Andrew Schmidt Law, PLLC
    Hilary Schwab of Fair Work, P.C.

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