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Ever wonder where those “delivery charges” go when you order food online?
They don’t always go the person who brings you your food.
In one such case, our client was a delivery driver for worked for a Domino’s franchise. The franchise charged a $2.50 “delivery fee,” but did not pay that money to the drivers. Instead, it kept that money for itself. We filed a lawsuit claiming that this practice violated the Massachusetts tips law.
Under the Massachusetts tips law, employers are prohibited from retaining or improperly distributing the proceeds of any “service charges” they collect. The tips law defines a “service charge” as:
[A] fee charged by an employer to a patron in lieu of a tip to any wait staff employee, service employee, or service bartender, including any fee designated as a service charge, tip, gratuity, or a fee that a patron or other consumer would reasonably expect to be given to a wait staff employee, service employee, or service bartender in lieu of, or in addition to, a tip.
In our case, we argued that Domino’s “delivery fee” qualified as a “service charge” because it was a “fee that a patron or other consumer would reasonably expect to be given to a wait staff employee [or] service employee … in lieu of, or in addition to, a tip.”
Rather than fighting the case on the merits and facing potential class liability, the Domino’s franchise that our client worked for elected to make him an offer of judgment.
In other words, the Domino’s franchise agreed that judgment would enter against it in exchange for paying our client the full amount of his damages – $19,500 – plus our legal fees and costs.
The Domino’s franchise later tried to get the court to award us a lower amount of fees and costs than we requested. The court refused. Instead, it agreed to award us our full fees and costs, which came to about $43,000.