A lawsuit filed in a Texarkana, Ark., federal court this month accuses the owner of multiple Domino's Pizza franchises of paying delivery drivers less than minimum wage in violation of state and federal laws.
The complaint was filed Sept. 7 in the Texarkana Division of the Western District of Arkansas on behalf of David Wright by Little Rock lawyer John Coulter. Wright is a Texarkana, Ark., resident who works as a delivery driver for a Domino's store in Texarkana, Ark. The suit seeks to include other Domino's delivery drivers as a collective class who have worked for stores operated by Tiger Eye Pizza, a corporation owned by Ken Schroepfer, in the three years before the filing of the lawsuit.
The suit accuses Tiger Eye and Schroepfer of violating the federal Fair Labor Standards Act and the Arkansas Minimum Wage Act. According to the complaint, delivery drivers are paid according to a formula that essentially amounts to less than Arkansas' minimum wage of $8.50.
The suit alleges drivers are paid "minimum wage minus a tip credit" for their time while dropping pizzas at the doors of customers.
"Defendants require delivery drivers to incur and/or pay job-related expenses, including but not limited to automobile costs and depreciation, gasoline expenses, automobile maintenance and parts, insurance, financing, cellphone costs, GPS charges, and other equipment necessary for delivery drivers to complete their job duties," the complaint states.
Drivers are not reimbursed for their actual expenses or paid mileage at the standard business rate defined by the Internal Revenue Service.
"Delivery drivers at the Tiger Eye Domino's Pizza stores are reimbursed a flat rate per delivery, no matter how many miles the deliveries take to complete," the complaint states.
The complaint notes the per-mile standard business rates defined by the IRS as 57.5 cents in 2015; 54 cents in 2016; 53.5 cents in 2017; and 54.5 cents in 2018.
"Regardless of the precise amount of the per-delivery reimbursement at any given point in time, defendant's reimbursement formula has resulted in an unreasonable underestimation of delivery drivers' automobile expenses throughout the recovery period, causing systematic violations of the minimum wage laws," the complaint alleges. "Because defendants paid their drivers a gross hourly wage at precisely, or at least very close to, the applicable minimum wage, and because the delivery drivers incurred unreimbursed automobile expenses and other job expenses, the delivery drivers 'kicked back' to defendants in an amount to cause minimum wage violations."
The suit also alleges drivers working for Tiger Eye have money deducted from their paychecks to pay for uniforms with the Domino's logo, which they are required to wear.
The suit complains that the "tipped" minimum wage rate drivers are paid for making deliveries plus the per-delivery reimbusement amount to less than minimum wage when a driver's actual expenses are considered. According to the complaint, Wright is paid $4.25 per hour while making deliveries. Regardless of the length of the trip, Wright receives $1.10 per delivery as compensation for expenses such as fuel, auto maintenance, insurance, cellphone and other costs. Before summer 2018, Wright alleges he was reimbursed at $1.05 per delivery.
The complaint alleges Wright and other drivers routinely "kicked back" about $4.38 an hour to the defendants.
"As a result of unreimbursed automobile expenses and other job-related expenses, defendants have failed to pay David Wright minimum wage as required by law," the complaint alleges. The suit argues that certification of the litigation as a class action is the best way to handle the drivers' claims.
"Current employees are often afraid to assert their rights out of fear of direct and indirect retaliation. Former employees are fearful of bringing claims because doing so can harm their employment, future employment, and future efforts to secure employment," the complaint states. "Class actions provide class members who are not named in the complaint a degree of anonymity, which allows for vindication of their rights while eliminating or reducing these risks."
The complaint is similar to a lawsuit filed in February in the Texarkana Division of the Eastern District of Texas against EPSI, a Domino's Pizza franchise operation which owns stores in a number Texas cities including Texarkana, Mount Pleasant and New Boston. U.S. District Judge Robert Schroeder granted class certification of the EPSI suit in April, and the case remains pending.
The suit against Tiger Eye is pending before U.S. District Judge Susan Hickey. Tiger Eye has not yet filed a response to the complaint.