Bimbo’s counterclaim was rejected in the drivers’ case.
On December 5, the Bimbo Bakeries USA and Bimbo Food Bakeries Distribution LLC counterclaim that delivery drivers received “unjust enrichment” was dismissed by the US District Court of Vermont. The lawsuit involving the counterclaim was filed by delivery drivers who demanded overtime compensation. The US Department of Labor and the drivers have submitted moves to dismiss the counterclaim.
On October 28, 2022, drivers who stocked and delivered baked goods to supermarkets and other retail locations in Vermont, Connecticut, and New York filed the complaint in the US District Court of Vermont. They argued that Bimbo had incorrectly designated them as independent contractors while, in reality, they were employees of Bimbo and were eligible for overtime compensation for working more than 40 hours each week.
On January 23, 2023, Bimbo Bakeries USA, Grupo Bimbo SAB de CV’s US subsidiary, filed court paperwork refuting the majority of the allegations. In the counterclaim, Bimbo further stated that she should be compensated for benefits provided to the drivers in the event that the court rules that the drivers are employees for the purposes of Vermont labor law. The perks included earnings from selling the drivers’ territorial distribution rights as well as incentives given to them in exchange for promoting Bimbo’s products.
The Department of Labor (DOL) and the drivers submitted moves to dismiss Bimbo’s counterclaim. They contended that the counterclaim ought to be rejected because permitting counterclaims that are subject to liability under the Fair Labor Standards Act (FLSA) would enable employers to “use the ongoing threat of counterclaims to discourage (workers) from asserting the FLSA rights” and would “chill” FLSA enforcement. On March 21, the DOL asked the Vermont court to grant the DOL’s motion to intervene and ask that the BBU counterclaim be dismissed.
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The district court in Vermont states that appellate courts have already clarified that permitting counterclaims against claimed FLSA violations may be detrimental to the statute’s enforcement.
Labor Solicitor Seema Nanda stated, “The court’s dismissal of Bimbo Bakeries’ counterclaim is a significant decision that strengthens the rights of workers under the Fair Labor Standards Act.” When an employer acts in a way that deters workers from speaking up, the Department of Labor will always be concerned. This covers retribution, forced employment conditions, or, as this court acknowledged, unlawful attempts to file counterclaims against employees who could be entitled to unpaid pay.