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DHL Drivers Sue Over Independent Contractor Status

June 2, 2005

Three drivers for package delivery service DHL have filed a class action lawsuit in Sacramento Superior Court against the company, according to a May 31 press release from Teamsters Local 150 and a May 14 report in the Sacramento Bee. The suit challenges the illegal classification of many of DHL drivers as independent contractors and demands payment of back wages and employee expenses going back four years.Some DHL delivery drivers don’t work directly for the German-based company, but rather for contractors such as DNM Delivery Solutions. Because of their independent contractor status, DHL can avoid paying drivers overtime wages. This also means independent contractors must bankroll the cost of their delivery vans, gas, vehicle maintenance and repair, payroll services and many other expenses.An organizer for Teamsters Local 150 says independently contracted DHL drivers average between $7 and $9 per hour with no medical benefits, no retirement and no paid sick leave, vacation or holidays.Companies say independent contractors help them save on overhead costs and allow them to exercise greater flexibility in managing their workforce.The lawsuit alleges that even though independent contractors are self-employed business people who pay their own workers' compensation and payroll taxes, their wages and working conditions are strictly controlled without granting the protections and benefits given to employees.A state task force is looking into the misclassification of workers in a number of industries in California, according to a May 14 report in the Sacramento Bee. FedEx Ground has faced numerous similar lawsuits across the country, according to the Bee report. In July a judge in Los Angeles ruled that drivers should have been treated as employees. The company is appealing the decision and argues that independent contractor arrangements are both legal and help foster an entrepreneurial spirit among drivers.
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