Biller & Kimble has negotiated a settlement on behalf of current and former Papa John’s delivery drivers at 73 stores in Ohio, Nevada, and North Carolina.
The $3.25 million settlement will be shared by the drivers based on the number of miles they drove for the franchise owner, Serazen, Inc.
The Papa John’s drivers’ lawsuit was filed in 2017 and alleged that the company under-paid their delivery drivers in violation of federal law because of the way they reimbursed the drivers for their automobile expenses.
Delivery drivers at this Papa John’s franchise were required to provide a car to use to make deliveries for the company. While the company recognized that they needed to reimburse the drivers for the costs associated with the use of their car, the drivers claimed that the company reimbursed the drivers at about $.30 per mile. If you are a delivery driver, you probably know that this is a very normal practice in the pizza delivery industry–it is how almost every pizza company in the country compensates their drivers.
But, our firm has helped thousands of drivers recover tens of millions of dollars by arguing that this arrangement is illegal. Specifically, the drivers in this case argued that the law required the company to reimburse them either by keeping track of and paying for the drivers’ actual expenses or by simply reimbursing at the IRS standard business mileage rate.
As the Court in this case explained, the IRS rate provides the ideal measure for reimbursing delivery drivers:
“The IRS mileage rate is a data-driven and systematic methodology for estimating the cost of driving a mile. The IRS mileage rate is a rate determined by the IRS that a taxpayer can deduct per mile driven for business, charitable activities, moving or medical purposes. The standard mileage rate changes regularly to keep up with inflation….The IRS bases these rates on cost data and analysis compiled every year by Runzheimer International, an independent research firm that contracts to the IRS. Runzheimer International uses data from across the country and measures auto insurance premiums, gas prices, maintenance costs, depreciation and other costs that go into operating a vehicle.”
Hatmaker v. PJ Ohio, LLC, Order Granting Summary Judgment, Nov. 5, 2019 (quotations omitted).
If you are a pizza driver, you may have heard of a concept that your employer does not have to pay the IRS rate, but can instead “reasonably approximate” drivers’ vehicle costs. Our firm has successfully argued in a number of cases that this supposed “standard” is an improper interpretation of the law. But, even if companies were permitted to “reasonably approximate” (which they are not), most of them have failed to do even that. Instead, they use this standard to reimburse as little as possible.
Biller & Kimble is working hard on behalf of delivery drivers so that all drivers, all across the country, are reimbursed at the IRS standard business mileage rate without having to sue for it. We have not succeeded in this endeavor–yet. But the battle continues.
If you are a delivery driver and would like to learn more about how you can help us and your fellow delivery drivers in this fight, please complete the form below or call our office at 513-901-8130. Consultations are free and we do not get paid unless we successfully recover money for you.