An Arkansas federal judge has given preliminary approval to a $3.45 million settlement by PAM Transport Inc. to settle a class action lawsuit involving truck drivers who alleged they were not paid minimum wages. U.S. District Judge P.K. Holmes III approved the preliminary agreement that certifies the class and settles claims that PAM violated the Fair Labor Standards Act (FLSA) and Arkansas labor laws by failing to pay drivers at least the federal and state minimum wages for the amount of time they spent on the road.
The class action alleges that PAM failed to pay drivers for activities that the Plaintiffs claimed are compensable as a matter of law, including on-duty time spent not driving and time spent in a truck’s sleeper beyond eight hours per day. The settlement applies to drivers who worked for the company from August 2010 to December 2013. The notice that will be sent out to drivers provides:
Even though PAM denies that it has violated any law and has what it believes are meritorious defenses to the claims alleged, it has decided to settle the lawsuit. The settlement enables PAM to avoid the costs and business distraction of protracted litigation and to dedicate its time and resources to ongoing business operations and, as such, benefits both its employees and customers.
The settlement provides that of the $3.45 million settlement amount, class counsel may seek up to a third, or $1.15 million, of it in attorneys’ fees. Half of the net settlement fund would be allocated to pay class members who are FLSA collective action claimants, while the other half would be set aside to pay those who are Rule 23 class claimants, meaning those who did not file a consent form to join the FLSA collective action by the time the Plaintiffs filed the motion seeking preliminary approval of the settlement.