Dive Brief:
- C.R. England may soon face a class-action lawsuit as a U.S. District Court Judge in Utah certified the expansion of a case filed by two independent contractors to potentially more than 14,708 drivers nationwide, based on four criteria, according to a press release by the plaintiff's lawyers.
- The suit alleges that C.R. England and its affiliates Opportunity Leasing and Horizon Truck Sales created a program promising students either company employment or the skills to become an independent contractor with a healthy income, American Shipper reports.
- Also according to the suit, driver positions for the company were almost nonexistent, and students in the training schools were misled into leasing trucks from the defendants in order to serve as contractors for England, resulting in significant debt.
Dive Insight:
The number of lawsuits brought by allegedly misclassified workers who may or may not be wholly dependent on an employer continues to grow, and the C.R. England case adds another level of uncertainty for companies working with contractors.
Flowers Foods, FedEx, and Amazon are three examples of employers who are either are facing or have already faced back pay or misclassification rulings. Meanwhile, a seven year case against Swift Transportation has yet to be settled. Ultimately, a true definition of an employee will have to be issued by the Department of Labor, but until that happens, workers and employers appear poised to continue to battle.
But the battle over employee classification is not limited to logistics, as economic drivers have led to a rise in outsourcing and contractor employment nationwide, per a report by The Wall Street Journal.
Companies relying on employment agencies or other businesses to provide staff are able to save not only on insurance but often on wages. Further, the ability to reduce or even grow staff minimizes the need for an active H.R. department, since the responsibility for training, hiring and firing falls on the agency rather than the company itself. Additionally, outsourcing may provide an illusion of increased employee revenue, since the output of contract workers remains uncounted.
