PepsiCo Agrees to Pay $5M to Settle Drivers’ Work Break Lawsuit

From labor disputes cases to labor and employment publications, for your research, you’ll find solutions on Bloomberg Law®. Protect your clients by developing strategies based on Litigation...

By Jon Steingart

PepsiCo Inc. and related companies agreed to pay $5 million to settle claims that drivers didn’t receive breaks required by California law.

About 1,800 current and former drivers in the Golden State will share the payout, according to their motion for court approval. If every class member participates in the settlement, each driver would receive about $1,990, the motion estimates.

California requires employers to provide rest breaks and meal breaks. Workers are supposed to be free of work duties during their breaks.

But the drivers weren’t free of duties because they were expected to respond to telephone calls from dispatchers and customers, they say. As a result, they should be compensated for that time, according to the lawsuit. They also said their paystubs and other records were incorrect as a result of the incorrect compensation.

If the drivers were to win all claims in a trial, the companies’ maximum liability would be about $7 million, the drivers estimated. The parties said they agreed to settle to avoid the risks, costs, and delays of litigation.

New Bern Transport Corp. and Pepsi-Cola Sales and Distribution, Inc., which are subsidiaries of PepsiCo., are also named as defendants.

The proposed settlement is subject to approval by Judge Edward M. Chen of the U.S. District Court for the Northern District of California. He’ll consider whether it’s a fair, adequate, and reasonable resolution of the dispute, taking into consideration the strength of the claims, the amount of the payout, and the reaction by class members.

William Turley, David Mara, and Jamie Serb of the Turley & Mara Law Firm in San Diego represent the drivers.

Samantha Hardy, Ashley Hirano, and Daniel De La Cruz with Sheppard, Mullin, Richter & Hampton LLP in San Diego represent PepsiCo and the subsidiary companies.

The case is Helton v. Pepsi-Cola Sales and Distribution, Inc., N.D. Cal., No. 3:17-cv-01135, motion for preliminary settlement approval 6/22/18.

Request Labor & Employment on Bloomberg Law