LOS ANGELES (AP) — A bankrupt trucking company has agreed to pay $5 million to settle allegations that it cheated hundreds of drivers who serve the Los Angeles and Long Beach seaports by misclassifying them as independent contractors.
Two activist groups had sued QTS Inc., its related companies and trustees for the owners, alleging the drivers were not classified as employees so the companies could avoid taxes and drivers would have to pay for truck maintenance, gas and insurance.
If approved by a judge next month, the settlement would apply to nearly 400 truckers, mainly Korean-Americans and Latino immigrants, according to a statement from the Wage Justice Center and Asian Americans Advancing Justice-Los Angeles.
Messages left for lawyers representing the owners weren't immediately returned, but the settlement filed in Los Angeles Superior Court on Thursday doesn't acknowledge wrongdoing.
About 16,000 drivers work at the ports, most of them independent contractors for trucking companies. The truckers say they face shrinking wages and want to be acknowledged as employees, which they say would mean better wages and workplace protections. There have been several strikes and dozens of lawsuits in recent years.
Trucking companies have argued that driver pay is good and picketing at the ports did not represent the majority of drivers.
"The trucking company dictated how much I got paid, which loads I took, and from whom, yet they denied that I was their employee," Victor Vitela, a former driver for QTS, said in a statement.
Minus expenses deducted from his paycheck, Vitela said he earned only a few hundred hours for an 80-hour workweek.
"Unfortunately, misclassification is the port industry norm," said Nicole Ochi, supervising litigation attorney for Asian Americans Advancing Justice-Los Angeles.
The suit also alleged that QTS used bankruptcy protections to avoid liability.