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Delivery drivers claim car costs slice their pay

On Behalf of | Jan 24, 2018 | Wage & Hour Law

Every driver knows that owning a car comes at a price. Not only are you paying for the car itself, but you’re also paying to keep it in good condition and insured. And when it comes to people who drive for a living, the price of owning and maintaining a car seems to triple. So who should pick up the bill for keeping the car on the road – the employer or the employee?


The cost of a pizza delivery

Last week, a lawsuit filed in Denver’s U.S. District Court alleges that one pizza company, in particular, isn’t adequately compensating drivers for the costs they incur when they make a delivery. A former Domino’s delivery driver in Arvada brought forth the lawsuit asserting that the rate at which she was reimbursed for mileage fell short of the true cost of keeping her vehicle on the road.

As a result, employees had to meet the costs of fuel, maintenance, repair and insurance on their own. The lawsuit alleges that when these types of costs are “kicked back” to the employees, employees end up receiving far below Colorado’s minimum wage. The employee is seeking reimbursement for the difference between the mileage rate that the company paid her and the standard IRS business mileage reimbursement rate, as well as litigation costs.

Tools of the trade and an employer’s responsibility

The lawsuit claims that the company violated the Fair Labor Standards Act of 1938 by having their employees pay for business-related expenses, thereby cutting into the minimum wage that they are required to be paid. They argue that car insurance, maintenance, repairs and fuel are necessary expenses to fulfill the role of a delivery driver. According to the law, if an employer requires an employee to provide “tools of the trade,” then the employer must ensure that the cost of maintaining the tools doesn’t reduce the amount that the employee makes. The lawsuit alleges that Dominoes failed to reimburse their delivery drivers at a reasonable rate, which resulted in the employees making less than minimum wage. The court will have to decide if the employer is responsible for picking up the bill and, if so, just how much of it.

But how will this affect Colorado? Now, you can have nearly anything delivered to your doorstep from groceries to cannabis. Does that mean that your other delivery drivers will get their car expenses covered by their employers too? For now, it’s hard to tell. But, in the meantime, delivery drivers nationwide might want to keep a close eye on this court case.