Transportation Brief: Ninth Circuit Addresses Piece-rate Pay Plans

by James H. Hanson, E. Ashley Paynter

August 25, 2021

Plaintiffs’ lawyers have long argued that under California law, drivers paid with a mileage-based compensation formula are not compensated for their non-driving activities, such as time spent conducting pre-trip and post-trip inspections, fueling, waiting at company terminals, waiting at customer locations, and completing paper work associated with a load. As a result, plaintiffs’ lawyers contend that employers must compensate drivers for performing those tasks separately from the pay they receive from their mileage-based compensation formula.

Notwithstanding such arguments, in Ayala v. U.S. Xpress, Inc., the Ninth Circuit recently ruled that a properly drafted piece-rate compensation pay plan that pays for delivered loads can cover both the time spent driving as well as the time spent performing non-driving activities associated with delivering the loads.

It is important to have a written compensation pay plan to address how drivers earn their activity-based pay.

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