Are Sleepy's mattress-delivery drivers eligible for overtime? A decision by a federal judge in a closely watched New Jersey case has paved the way for an answer in a lawsuit filed six years ago.
In March 2010, a handful of drivers who delivered mattresses in New Jersey filed a lawsuit in federal court saying they were not paid overtime because they were wrongfully classified as independent contractors.
U.S. District Judge Peter G. Sheridan in Trenton determined on Oct. 25 that the plaintiffs were actually employees, but his ruling came after the case had bounced up and down the appellate chain, with a foray into state court.
In 2012, Sheridan originally determined that the drivers were independent contractors, in part because they had signed documents saying they were contractors, not employees. Their lawyer, Anthony L. Marchetti Jr. of Cherry Hill, appealed the decision to the U.S. Court of Appeals for the Third Circuit, which kicked it to the New Jersey Supreme Court to figure out how to determine whether the drivers were employees or independent contractors.
In a period when misclassification cases were filed regularly and were a hot topic in employment law, the Sleepy's case was closely watched, with organizations such as the National Federation of Independent Businesses writing briefs in support of Sleepy's position that the drivers owned their own trucking businesses and merely delivered for the company.
The New Jersey Supreme Court told the Third Circuit, which told Sheridan, that the "ABC test," derived from New Jersey's Unemployment Compensation Act, had to be used to determine employment status. If the company substantially controlled the daily work of the individuals, if their work was essential to the company, and, finally, if they realistically would not be able to handle business from other clients, the workers had to be considered employees, not independent contractors.
Sheridan found all three "ABC" conditions in his ruling.