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Swift contractors deemed employees by federal court

Swift Transportation truck riding on the road

Photo by Jim Allen/365 Trucking

Swift Transportation is appealing a recent federal court’s decision that its owner-operator contractor agreements constitute employment, opening the door for the driver plaintiffs to receive back pay and other relief from the company, as sought in their lawsuit.

About 5,000 of Swift’s 19,000 drivers are owner-operators, but only five owner-operators are involved in the lawsuit explicitly.

Swift, the country’s largest truckload carrier (No. 4 in the CCJ Top 250), filed for appeal Jan. 11, following last week’s ruling, which allows the truckers to seek class action certification. In 2014, the Supreme Court denied Swift’s request that it review the seven-year-old case. The company did not respond to a request for comment.

The five plaintiffs signed Swift’s contractor agreements, which require contract disputes to be resolved through arbitration. However, the FAA exempts employees engaged interstate commerce from being compelled to use arbitration instead of the courts. “Altogether, the terms of the contractor agreements, bolstered by the evidence presented as to how those terms worked in practice, persuade the court to find that plaintiffs had contracts of employment which are exempt from arbitration,” Senior U.S. District Judge John W. Sedwick wrote.

The truckers signed the agreements and leases with Interstate Equipment Leasing at the same time. “Under the terms of the IEL leases, the ability of plaintiffs to keep leasing their trucks was explicitly dependent on them maintaining their contractor agreements with Swift, when read in conjunction with the at-will termination provision in the contractor agreements, Swift effectively had full control of the terms of the relationship,” Sedwick stated, meaning the drivers were more employee than contractor.

Misclassification has been a topic of growing concern for trucking companies in recent years, with several high-profile court rulings swinging in favor of drivers and against carriers. See coverage of those cases in the links below:

Carriers must allow drivers meal and rest break under Calif. law, court rules

A federal appeals court ruled this week that motor carriers are not exempt from California state law requiring mandatory paid breaks for workers, overturning a ...

Federal appeals court rules against independent contractor status in Calif. case

An appeals court June 16 ruled that drivers working for Georgia-based carrier Affinity Logistics — but working in California — were not independent contractors, as ...

Calif. Supreme Court rules drivers are employees, not contractors, in misclassification case

Drivers signed on as independent contractors for the Long Beach, Calif.-based Pac Anchor Transportation were misclassified as contractors and should have instead been classified as ...

Calif. judge upholds ruling that carrier owes driver $179k in back wages over misclassification

A Los Angeles superior court ruled that Laca Express Inc. owes driver Ho Woo Lee $179,390 in back wages and expenses, upholding the state labor ...

Carrier ordered to pay drivers $7M in back wages over alleged misclassification

Carrier ordered to pay drivers $7M in back wages over alleged misclassification

The California Labor Commissioner has concluded 38 Pacific 9 Transportation drivers are employees — not contractors — and that the drayage company owes them $6,926,279 ...

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