California Truck Drivers Misclassification Settlement

Los Angeles, CAA class action California labor lawsuit alleging STG Logistics and STG Drayage misclassified truck drivers as independent contractors has settled for a $4.2 million. As part of the deal, STG will no longer classify its long-haul drivers as independent contractors in California and New Jersey. And this isn’t STG’s first court appearance.

The settlement between long-haul truck drivers out of ports in Los Angeles and San Diego was approved in Los Angeles federal court. More than 400 former owner-operators who drove for STG and XPO Logistics‘ North American intermodal shipping business will each receive approximately $7,500 after attorney fees. Plaintiff Milton Quinones filed the misclassification lawsuit, Milton Quinones v. XPO Logistics, Inc et al., in February 2023, accusing STG Logistics of having a level of control over their operations that was “substantially similar” to that of the company’s employed drivers. Classified as independent contractors, the  drivers were denied health insurance, paid sick leave, overtime pay and the ability to form a union.

According to the complaint, owner-operators were misclassified because STG Logistics controlled their operations, from the timing of their work to the work they performed and how that work was performed. STG control comprised:

• A point system for policy violations (with points given for being disrespectful to dispatchers, speeding in a personal vehicle, not wearing a seat belt, etc.),
• Reporting requirements,
• Schedules that were decided by dispatch, with few options,
• Multiple hours of onboarding meetings that detailed rules and policies, and mandatory videos and tests,
• Logs to be submitted daily,
• GPS tracking,
• A signed non-negotiable contract whereby STG could unilaterally reissue the provision in the contract determining compensation each quarter.

Because the truckers should have been classified as employees rather than independent contractors or owner-operators, the plaintiffs charged STG Logistics with:

• Unpaid wages for time waiting at facilities,
• Mandatory safety meetings and other time spent performing work,
• Compensation for business expenses (scale tickets, fuel, maintenance, GPS devices),
• Compensation for unlawful deductions (insurance, IFTA, use of DOT number).

More STG Misclassification Lawsuits

This STG lawsuit is a repeat performance. The company faces a misclassification lawsuit filed in New Jersey early this year, making it the first lawsuit under a 2021 New Jersey independent misclassification law filed against trucking companies. Like the California suit, this complaint seeks to stop the companies from misclassifying drivers as independent contractors as well as get back wages, penalties and fines, and damages from allegedly improper deductions. More than 300 truck drivers are affected.

In June 2022, the Los Angeles office of the National Labor Relations Board (NLRB) ruled that more than 250 port drivers working for STG Cartage LLC, doing business as XPO Logistics in Southern California were misclassified as independent contractors.

In October 2021, XPO settled two California port driver lawsuits dealing with misclassification for nearly $30 million, which involved hundreds of drivers.

In Sept 2019, XPO Logistics settled another California wage lawsuit: nearly 4,000 drivers divvied up $5.5 million. The lawsuit claimed that XPO Last Mile failed to provide legally compliant meal and rest breaks and failed to pay wages for all hours worked, waiting time penalties, reimbursement of business expenses and legally compliant pay stubs.

Multiple settlements beg the question: How can it pay to misclassify truck drivers as independent contractors?