Labor & Employment Law Daily Wrap Up, WAGE-HOUR—CLASS ACTIONS—D. Neb.: Truck drivers survive employer’s motion to decertify class actions challenging pay practices, (Apr 1, 2025)

By Ronald Miller, J.D.

The court agreed with the drivers that the same standards to assess whether a driver was on duty in the sleeper berth and at other times under the FLSA would apply under the NWHA.

A trucking company was not entitled to decertification of class actions brought by truck drivers who alleged that the employer violated various California and Nebraska wage and hour laws relating to the employer’s compensation practices, ruled a federal district court in Nebraska. On the other hand, the employees’ motion for summary judgment on liability was denied as to the compensability of non-driving time under California law and denied as to the compensability of non-driving time under Nebraska’s Wage and Hour Act (Abarca v. Werner Enterprises, Inc., Nos. 8:14CV319, 8:15CV287 and 8:17CV145 (D. Neb. Mar. 28, 2025)).

Class action claims. Werner Enterprises is an interstate commercial trucking company with terminals in Nebraska and California. Truck drivers employed by the employer undergo orientation, including receiving a handbook and signing a series of forms. An acknowledgment of employment form indicated the driver would be “subject to Nebraska’s workers’ compensation jurisdiction and laws and Nebraska’s labor and employment laws.”

Werner does not pay its drivers by the hour. Rather, the employer’s compensation system is based on an estimate of the number of miles each trip should take. Werner asserted it takes into consideration all activities necessary to complete a trip such as pre-trip and post-trip inspections, fueling, driving, and completing paperwork.

Truck drivers employed by Werner brought a class action alleging various violations of California and Nebraska wage and hour laws relating to the employer’s compensation practices. Previously, the court certified two classes, a Nebraska class and a California class. The parties have completed liability-related discovery and now move for summary judgment. Werner also moved to decertify two class claims.

As an initial matter, Werner raised three issues: whether a prior class-action case served as a res judicata bar to the present action; whether Nebraska or California law governs; and whether recent changes in California case law affect the court’s jurisdiction. The employer argued that these issues supported decertifying class and granting summary judgment in its favor and denying summary to the employees.

Claim preclusion. As to whether claim preclusion applied to the present case, the court noted that the plaintiffs in the previous case were concerned with Werner’s “per diem” program which provided reimbursements for business expenses accrued over the road. In that case, the judge found that the per diem payment system did not violate state or federal law. However, this case is concerned with Werner’s alleged failure to compensate for non-driving time, making improper pay deductions, and failing to provide accurate wage statements.

Because the cases were independent of each other and sought to redress different injuries arising from distinct conduct, the claims were not precluded on res judicata grounds, and the court declined to decertify the class or grant summary judgment on this basis.

Choice of law. Werner also argued that the drivers all agreed to be subject solely to Nebraska law when they accepted employment with it. However, the court determined that the acknowledgment form did not restrict drivers in the California class from asserting claims under California law. First, the acknowledgment form did not waive the protections of California law which may be in addition to those provided by Nebraska law. Moreover, the enforceability a waiver would be questionable because California has an express public policy of protecting workers. Thus, the acknowledgment form did not require decertifying the California sub-class nor did it provide a basis for granting Werner summary judgment on the employees’ California claims.

California law. Next, the court rejected Werner’s contention that a California case, Ward v. United Airlines, Inc., 986 F. 3d 1234 (9th Cir. 2021), required to decertify the California class and conduct an individualized inquiry into whether each member has adequate ties to California such as would permit the application of California law. Nothing about intervening California case law requires the Court to decertify the California subclass or deny the California drivers’ claims.

Decertification of class. Werner further argued that the court should decertify both the Nebraska and California classes. It argued that an individualized inquiry is required to determine how each driver was paid; each driver’s pay deduction and wage statement claim requires an individualized examination; the named Plaintiffs are inadequate representatives; the case is not manageable as a class action, and the court can’t issue a class-wide injunction.

While it may be true that each driver received different amounts of pay in a specific pay period, the drivers’ claims are concerned not with any given driver’s wages in a single instance but with the overarching system of compensation, concluded the court. Werner’s practice and policy of compensating its drivers on a mileage or trip basis is common to all drivers. Because the individual analysis Werner claimed was not required, the court maintained this case as a class action. The court also concluded the class representatives remained adequate. Further, because the drivers were only seeking declaratory relief, a class action injunction was unnecessary. Accordingly, the classes remained as previously certified.

Liability issues. The parties filed cross-motions for summary judgment on liability for the following issues: compensability of non-driving time under California law; paycheck deductions under California law; contents of pay statements under California law; derivative California claims; compensability of non-driving time under the Nebraska Wage and Hour Act; and paycheck deductions under the Nebraska Wage Payment and Collection Act.

Non-driving time under California law. Werner moved for summary judgment on the drivers’ claim that it failed to compensate them for non-driving time under California law, based on new California cases that confirmed its piece-rate pay system was permissible under California law and the drivers’ sleeper berth time was not compensable. For their part, the drivers argued that Werner failed to pay them minimum wage because it failed to pay them for compensable non-driving time such as sleeper berth time.

In an earlier order, the court already determined that while California law does not prohibit piece-rate pay systems, questions of material fact precluded a determination that the pay system at issue in this case was lawful. Werner provides no basis for the court to reconsider its prior ruling. Summary judgment was inappropriate due to the dispute between the parties regarding whether the employer’s pay system was trip-based, or as the employees’ argued, a mileage-based system. The court found that there was evidence from which a reasonable factfinder could draw either conclusion.

Further, summary judgment was unwarranted because there was a dispute of fact as to whether the time drivers spent in the sleeper berth was compensable or not. There were disputed facts about the extent to which Werner exercised control over drivers while they were resting in the sleeper berth.

Paycheck deductions under California law. The parties filed cross-motions on the drivers’ claim of improper pay deductions related to a personal bond and pay-advance fee policy. Under California law, an employer is permitted to withhold wages “when a deduction is expressly authorized in writing by the employee to cover insurance premiums, hospital or medical dues, or other deductions not amounting to a rebate or deduction from the standard wage.”

Although there is a split of authority among California trial courts where there is a private right of action for an employee to sue to recover deductions for a pay-advance fee, the court agreed with the reasoning of those finding that a private right of action exists. On the other hand, the court rejected the drivers’ contention that the paycheck advance fee is a prohibited “rebate or deduction” from wages.

As to the personal bond, the undisputed evidence showed drivers expressly and explicitly authorized the bond by signing an Employment Conditions form. Accordingly, the drivers voluntarily authorized the bond withdrawals. Thus, the drivers were entitled to summary judgment as to the paycheck-advance fee, and Werner was entitled to summary judgment as to the personal bond.

Non-driving time under Nebraska law. The parties also filed cross-motions for summary judgment on drivers’ claim that they were unfairly paid less than the minimum age under the Nebraska Wage and Hour Act (NWHA). Werner argued that Nebraska would follow the so-called Klinghoffer rule which holds employers meet the minimum wage requirement as long as the driver’s total weekly pay equals or exceeds their total weekly hours multiplied by the applicable minimum wage, United States v. Klinghoffer Bros. Realty Corp., 285 F2d 487, 490 (2d Cir. 1960). However, the court has repeatedly declined to apply the Klinghoffer rule to the NWHA and has instead calculated minimum wage on an hour-by-hour basis.

Further, the court agreed with the drivers that the same standards to assess whether a driver was on duty in the sleeper berth and at other times under the FLSA would apply under the NWHA. Thus, disputes of material fact preclude granting summary judgment in either party’s favor on the issue of the compensability of non-driving time under the NWHA.

The cases are Nos. 8:14CV319, 8:15CV287 and 8:17CV145.

Judge: Bataillon, J.

Attorneys: David A. Borgen (Dardarian Ho Kan & Lee) for Ezequiel Olivares Abarca. Alison J. Cubre (Littler Mendelson) for Werner Enterprises, Inc.

Companies: Werner Enterprises, Inc.

Cases: WageHour ClassActions CoverageLiability WorkingTime StateLawClaims NebraskaNews