Trucking Companies Using a Trick to Dodge Punishment?
It was only two years ago when the largest judgement ever was handed down in an industry where workers often claim they’re exploited.
A California labor court judge ordered Fargo Trucking to pay drivers for cheating them out of fair wages. The payout, which was a whopping $8.7 million, amounted to roughly $370,000 per driver involved.
Sadly for the drivers involved, their big payout never came. Fargo Trucking went out of business – however, their team, trucks, and client relationships are still in the industry to this day. The only difference is, they’re operating under a different name.
Shortly after the judgement was given, Fargo’s management began taking steps to make their organization disappear. After ditching retail clients and removing assets from the organization, they set up shop under a new name, and are now safe from court judgements.
Express FTC is going strong, but the drivers in the lawsuit still haven’t been paid.
This move is nothing out of the ordinary. Many trucking companies have reportedly done the same thing, dodging penalties and punishments handed down for a variety of violations.
Some carriers allegedly delayed paying what they owed, then used bankruptcy protection to get out of it. Others put the payment off for so long with loopholes they were able to convince drivers to take settlements that were only a fraction of the original judgments.
A recent controversy involving port truckers was addressed with two legislative proposals. The matter did illustrate how carriers would take advantage of drivers. In the case of the port truckers, many claimed that lease-to-own schemes turned them into little more than indentured servants.
Port truckers were awarded millions between 2012 and 2016, though there are disagreements concerning how much actually made it to drivers, it shows how monumental labor disputes have become in trucking.
Unfair working conditions may have created a bigger problem for the trucking industry. Beyond the legal troubles of carriers, trucking as a whole is seeing a major driver shortage. For the first time in over a decade, the issue is listed as one of the most concerning in trucking according to major industry leaders. Companies that cheat drivers may end up hurting themselves (and the rest of their industry) in the long run.