That’s How the Cookie Crumbles: Insomnia Cookies and Mileage-Related Wage Violations

Recently, a group of former and current employees from Insomnia Cookies filed a class and collective action lawsuit against their employer. The company is known for delivering warm cookies and catering to students, many in New York City, who often order late at night. This group of employees alleges that the company has committed widespread mileage-related wage violations. These types of violations occur when a company requires an employee to use their personal car for work and they don’t reimburse them appropriately for driving-related expenses. According to the legal complaint, Insomnia Cookies allegedly required their delivery drivers to bear the costs associated with their personal vehicles, including costs for gasoline, vehicle depreciation, insurance, maintenance, and repairs. The company allegedly paid employees a subminimum wage due to a practice of not reimbursing for these vehicle costs. Mileage-Related wage violations are becoming increasingly common as more food delivery options become available for consumers, particularly in large urban locations like New York City.

More Examples of Mileage-Related Wage Violations

Many of the top U.S. food and beverage companies are notorious for these types of violations. For example, Starbucks recently settled a class action lawsuit that involved 30,000 employees, costing the company $3 million. Plaintiffs alleged that Starbucks did not reimburse workers for mileage expenses incurred when using their personal vehicles on the job “as a matter of company policy.” A similar lawsuit involved Pizza Hut, who settled a class action suit for $5.1 million. The plaintiffs argued that they were not reimbursed for job-related costs incurred while using their personal vehicles to make Pizza Hut Deliveries. Finally, Dominos has faced two class action suits with alleged mileage-related wage violations. Domino’s franchisees allegedly paid a flat rate reimbursement of $1 per delivery. This reimbursement took employees’ payments below the minimum wage, resulting in a violation of the Fair Labor Standards Act.

What Mileage-Related Reimbursements Are You Eligible For?

These types of reimbursements vary on a state by state basis. New York State law requires reimbursement for business use of privately owned automobiles based on the standard mileage allowance established by the Internal Revenue Service (IRS). Inaccurate mileage reimbursements can cost employers hundreds of dollars per employee each month, adding up to thousands of dollars over the course of a year. When employers fall short of these mileage standards, class-action lawsuits can occur which stretch the costs of inaccurate mileage reimbursements into the millions, as seen with the lawsuits mentioned above.

 

Seek a New York Wage Attorney to Combat Mileage-Related violations

Employers who violate mileage-related wage laws in New York City must be held accountable. If you feel you have not been properly reimbursed for expenses related to the use of your personal vehicle at work, the Law Office of Christopher Q. Davis, located in New York City, can assist you. Contact us today at (646) 430-7930 to schedule a free case evaluation and receive experienced legal counsel.