A pending case out of Massachusetts may set a standard for pizza delivery chains across the United States. Employees of national chain Domino’s Pizza filed a claim stating that Domino’s had violated wage and hour laws by keeping the delivery charge that customers paid instead of giving the money to the delivery drivers. The main question is whether an online disclaimer is sufficient to notify customers that the service charge did not constitute a tip.
Facts of the Case
Domino’s Pizza stores charged a delivery fee of $2.50 for each delivery order, which the company did not hand over to the delivery drivers. Often, however, customers mistakenly assumed that the delivery charge would go to the driver, and therefore would not add an additional tip amount to their bill. The law states that wait staff, delivery drivers, and other service employees must receive a service charge that is in lieu of a tip. Therefore, the customer must be notified that the charge is not a tip for the employer in order to keep the charge for itself.
Domino’s argued that its online order form states, “Any Delivery Charge is not a tip paid to your driver. Please reward your driver for awesomeness.” However, when customers called in to place their orders, they were not informed of anything regarding the delivery charge or tips, and instead were simply given the total amount due. When customers would see the charge on their bill upon delivery, drivers assert they would mistake it for an included tip. Because all customers were not adequately informed that the delivery charge was not a tip, drivers deserved to receive the amount of the charge for each delivery. Furthermore, the court reasoned it was possible for customers to mistake the service charge as a tip because $2.50 would often be an appropriate tip amount.
Case Proceeding to Trial
Though the court did not reach a final decision yet, it did decide there was a triable issue on the table and Domino’s was denied a dismissal. If the court finds that Domino’s should have paid the charge to its drivers, that particular Domino’s franchisee will be liable for the costly back payment of thousands of delivery charges. Furthermore, the suit may inspire more cases around the country claiming that Domino’s has violated the respective state wage and tip laws.This is the second time Domino’s has been sued this past year for violation of employment laws. Earlier in 2013, drivers in New York were fired after they complained that they deserved the full minimum wage instead of the tipped minimum wage because they performed other duties in the kitchen. They were all subsequently awarded their jobs back by the court.
If you have any questions or concerns regarding employment laws, do not hesitate to contact HKM Employment Attorneys today for help.