New Haven Register (New Haven, CT)
Calif. drivers to get nearly $30M deal from Conn.-based XPO Logistics
GREENWICH — Trucking giant XPO Logistics has agreed to pay nearly $30 million to settle class-action lawsuits involving hundreds of drivers in California who accused the company of numerous labor violations related to their delivery of goods from Los Angeles-area ports.
Approved on a preliminary basis by a federal judge, the settlements are in answer to allegations that subsidiaries of Greenwichbased XPO perpetrated misconduct that included misclassifying workers as contractors, failure to pay minimum wages and wages for missed meals and rest periods and failure to reimburse workers for business expenses.
The International Brotherhood of Teamsters union, which has been trying to organize XPO workers for years, lauded the settlements — which they said would benefit nearly 800 current and former port drivers. The union has vowed to keep fighting for the rights of XPO workers, including those based in Connecticut.
“Misclassification of workers is all too common in the ports of Los Angeles and its surrounding areas, and while XPO is notorious for doing this, there are far too many employers still cheating workers out of the pay and the rights they deserve,” Ron Herrera, director of the Teamsters’ port division and vice president of its western region, said in a statement. “The Teamsters will continue to fight in support of these XPO drivers and their efforts to be reclassified as employees, and our union will do what it takes to eliminate misclassification so that it’s no longer a reality in California's ports.”
XPO officials denied all liability and said the company does not have to classify the port drivers as employees. They said many independent contractors have told the company in recent years that they appreciate the flexible work arrangements provided by being designated independent contractors, and that independent contractors who want to work as fulltime employees can always apply for truckdriver openings.
“With the legal and regulatory landscape in California evolving, we reached a settlement on terms that are favorable for XPO and should put this matter behind us,” the company said in a statement.
Several more steps must be completed before the settlements can be implemented. Judge R. Gary Klausner set a Dec. 6 postmark deadline for objections and requests for exclusion from the settlements and scheduled a final approval hearing for Dec. 18, according to court records.
The port drivers in the classaction groups haul imported goods — including electronics, clothing, furniture and food — for retailers such as Amazon, Walmart, Target, Apple, IKEA, Toyota and thousands of other companies, according to the Teamsters.
The settlements have emerged a couple of months after XPO completed the spin-off of its logistics business into its own company, GXO Logistics.
Ranking as the No. 190 company on this year’s Fortune 500 list, XPO had earlier considered the sale of key businesses. It has kept its global transportation operations — which are primarily truck brokerage and “less-than-truckload” shipping services.
XPO and GXO are headquartered, respectively, at 5 American Lane and 2 American Lane in the northwest corner of Greenwich.
Within Connecticut, GXO now operates logistics facilities in
North Haven and Windsor, while XPO has kept last-mile sites in Bridgeport, Norwich, Wallingford and Windsor and less-than-truckload terminals in Bridgeport and Meriden.
In October 2017, a majority of the North Haven employees, who had previously voted for Teamsters representation, petitioned the company to withdraw its recognition of the union as their representative — a request that was granted, according to XPO officials.
In May 2019, about a dozen North Haven employees went on a short strike. XPO said that the walkout did not disrupt its operations there.
No GXO employees are Teamsters members, according to the company.
The Teamsters have secured contracts for more than 100 XPO workers in Miami and Trenton, N.J., while “negotiations and organizing are ongoing in other locations,” a Teamsters spokesman told Hearst Connecticut Media.
In response to an inquiry about the extent of talks with the Teamsters, an XPO spokesperson said the company is “currently engaged in good-faith negotiations for a first contract in Bakersfield (Calif.), Los Angeles and King of Prussia (Pa.)”
As of July, approximately 200 U.S. employees were represented by the Teamsters among 35,000 eligible workers, according to XPO.
The company’s treatment of workers during the COVID-19 pandemic has emerged as another source of contention between the union and the company. In response to a Teamsters forum in May 2020 that highlighted a number of workers’ complaints, XPO officials pointed to a number of new benefits.
To encourage employees to stay home when they were ill, the company said it provided two extra weeks of paid sick leave for employees in the U.S. and Canada. The company also added free COVID-19 testing to its U.S. health insurance coverage and provided free access to telehealth services.
In addition, XPO implemented “front-line appreciation pay” for nearly 40,000 employees in the U.S. Hourly warehouse workers qualified for an extra $2 per hour on top of their regular rates.