‘Fraudulent Fiction’: Lawsuit Claims Goya Misclassified Delivery Drivers, Withheld Wages to Cover Operating Costs

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A proposed class action lawsuit alleges Goya Foods, Inc. has misclassified some of its delivery drivers as independent contractors and unlawfully deducted certain operations costs from their wages.

More specifically, the case claims Goya Foods and its officers have subtracted from drivers’ pay fees and costs associated vehicle leasing, fuel and maintenance, insurance, trailer and other equipment rentals, administrative fees, returned and damaged product expenses, “and other deductions not allowed by governing law” given the workers fall more accurately under the definition of employees, not contractors.

The case, which was initially filed in New Jersey Supreme Court in July 2019 and removed on September 4 to the state’s district court, explains that Goya Foods operates 14 U.S. distribution centers from which delivery drivers—some of whom are traditional W-2 employees while others are classified as contractors—pick up orders to deliver directly to customers’ stores on a next-day basis.

Given the level of control Goya exercises over its delivery drivers, the workers should have been classified as employees rather than contractors, the lawsuit argues, listing the following reasons by the defendants’ “contractor” tag is inaccurate:

• Truck delivery drivers are an “integral part” of Goya’s business model;
• Delivery drivers do not perform work outside of the scope of Goya’s normal course, or even place, of business;
• Truck drivers’ stops are exclusively directed by Goya via delivery tickets, and workers do not deliver to other customers;
• Truck drivers exercise “no meaningful control” over their deliveries as they are provided a loaded trailer each night with specific delivery instructions;
• Drivers are provided with an XRS handheld device to track location, hours and mileage, while an independent contractor would normally be required to provide their own device;
• Truck drivers do not utilize their vehicles for other clients;
• Drivers are directed by a dispatcher who controls the deliveries and drivers “at all times” and maintains regular communication with the workers, including by pre-approving days off; and
• Delivery workers are required to return their trucks to a trucking yard each day, after which the vehicles are fueled and loaded for the next day’s deliveries.

As the complaint tells it, Goya’s designation of delivery drivers as independent contractors amounts to a “fraudulent fiction” meant to hide their true employee status. Despite maintaining control over most aspects of drivers’ duties, Goya has failed to provide the workers with employee benefits ranging from paid time off to vacation and holiday pay while deducting normal business expenses—including the costs of fuel, oil and equipment repairs—from their wages, the suit alleges.

“Indeed, Defendants directed and controlled important aspects of their employment including deliveries and their schedule of work yet Defendants deducted money normally considered business expenses from the drivers’ weekly paychecks ostensibly for payment for the truck leases and other costs and fees associated with deliveries of their product,” the complaint says.

According to the case, delivery drivers were paid “commissions” based on a percentage of the delivered products assigned and provided to them each day, as well as incentive pay when the total amount of returned items did not exceed a certain percentage of the product delivered.

The delivery drivers’ agreement with Goya also provided for a “Reserve” account from which the company would make certain deductions each week, the suit continues. Per the complaint, Goya has unlawfully deducted the following amounts from the plaintiff’s reserve account each week:

• $125.00 for trailer rental;
• $150.00 for truck insurance;
• $23.94 for Helpers Workmen’s Compensation insurance;
• $580.73 for the truck lease;
• $250.00 for equipment;
• An average of $400.00 to $500.00 for fuel costs;
• A $2.50 “professional fee” to administer the deductions;
• Roughly $276.64 to maintain the reserve account in case the plaintiff could not work to pay the fees required; and
• The costs of rejected goods at the time of delivery, returns, and damaged goods that were previously delivered.

The lawsuit alleges the defendants have violated both the New Jersey Wage Payment Act and New Jersey Civil RICO Act by withholding drivers’ wages via unlawful deductions.

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