Lawsuit Claims Marco’s Failed to Properly Reimburse Georgia Delivery Drivers for Vehicle Expenses

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The operators of a chain of Marco’s franchise restaurants in Georgia have failed to properly reimburse delivery drivers for the costs of operating their vehicles, a proposed collective action alleges.

According to the case, the defendants have used a “flawed method” to determine reimbursement rates for the expenses drivers incur for gasoline, vehicle parts and fluid and repairs and maintenance, as well as insurance, depreciation and other costs associated with operating their vehicles to deliver pizza and other food items to Marco’s customers.

As a result, delivery drivers are reimbursed at “such an unreasonably low rate” that the unreimbursed expenses have caused the workers’ wages to fall below the federal minimum rate during some or all workweeks, the suit alleges.

Per the complaint, Marco’s requires delivery drivers to maintain and pay for safe, legally operable, insured automobiles for delivering food and reimburses the workers on a per-delivery basis. The per-mile reimbursement rate, however, falls well below the IRS business mileage reimbursement rate “or any other reasonable approximation of the cost to own and operate a motor vehicle,” the lawsuit alleges.

The suit says that the IRS business mileage rate during the applicable limitations period, which lined up with other approximations by reputable companies such as the American Automobile Association (AAA), ranged between $.535 and $.58 per mile.

According to the suit, the driving conditions associated with delivering pizza lead to more frequent maintenance, higher repair costs, lower gas mileage and more rapid depreciation compared to the average cost of owning and operating a motor vehicle, in particular in that the delivery business sees frequent stopping and starting, frequent braking, short routes and driving under time pressure.

The case approximates that the plaintiff, who worked for Marco’s in Georgia between March 2016 and July 2020, was reimbursed about $.18 per mile, with an average delivery distance of six miles. Comparing the plaintiff’s reimbursement rate with the lowest IRS business mileage rate at the time, which represents a reasonable approximation of the man’s vehicle expenses, the lawsuit estimates the plaintiff’s unreimbursed expenses caused his wages to be cut down to an hourly rate of $2.99.

The lawsuit alleges that because Marco’s delivery drivers were paid at or near the federal minimum wage, the amounts “kicked back” to the defendants in the form of unreimbursed vehicle expenses were sufficient to cause minimum wage violations.

According to the suit, the net effect of the defendants’ flawed reimbursement policy, which was applied to all delivery drivers, was that the restaurant chain willfully failed to pay drivers at the proper minimum wage rate and “thereby enjoyed ill-gained profits at the expense of their employees.”

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