Mega-carrier Knight-Swift as agreed to pay current and former drivers $100 million as part of a settlement deal. This will bring an almost decade-long legal battle to an end.
Before Swift Transportation merged with Knight, it faced a class action lawsuit brought by a group of truck drivers. Swift was calling its leased drivers ‘independent contractors,’ but the drivers claimed that they should have been classified as employees.
According to attorneys representing the truckers, Swift was failing to give their leased drivers the benefits that they should have enjoyed as employees. Swift automatically deducted money from drivers’ pay checks for lease payments, gas, maintenance, insurance, and more – all while failing to pay drivers even minimum wage.
To be eligible to join the class and receive a portion of the payment, drivers must have entered into an independent contractor agreement with Swift and leased one of their trucks prior to Jan. 1st, 2019. How much of a payout individual class members receive will be determined by multiple different factors including duration of employment. Even some drivers who drove for Swift as far back as 1999 may be eligible.
All told, approximately 19,000 current and former Swift drivers may be eligible to join the class. That means an average payout of approximately $5,000 per class member.
The lawsuit began back in 2009. It went to appeals multiple times. Attorneys even appealed to the U.S. Supreme Court to hear the case. Very little progress was made until the Knight-Swift merger in 2017. Then, negotiations picked back up.
Even with a renewed interest in finally settling the issue, it wasn’t until other court rulings set precedents that Knight-Swift decided to settle.
Several courts found that minimum-wage laws did in fact apply to truckers. This meant drivers must be earning at least minimum wage for ALL hours spent “on-duty,” even hours not spent driving. A judge in one specific case against PAM Transport ruled in October that an OTR company driver should be entitled to minimum wage for 16 hours per workday.
But there was another problem: All of Swift’s lease operator contracts had included a forced arbitration agreement. Swift attorneys argued that the drivers didn’t even have the right to sue the company since they had agreed to settle all disputes through arbitration – not in courts.
Then, in January of this year, a case brought against New Prime, Inc. went to the U.S. Supreme Court. The court ruled unanimously that independent contractors like the owner-operators at Prime could not be bound by forced arbitration agreements.
While Knight-Swift hasn’t said anything to this effect, rulings like these may have pushed them to decide to settle with the drivers – and possibly for more money than expected. PAM Transport settled a similar case for $3.45 million in 2015. A year later, C.R. England settled for $2.35 million. But even once you take into account the number of drivers taking part in the class action suit, the $100 million Knight-Swift will be paying out is far more than other companies have paid.