It’s Not A Tip: 8th Circuit Reverses Class Certification of Pizza Delivery Drivers Based on Dukes
Having grown up near Ann Arbor, and later attending college at the University of Michigan, I have no doubt probably ordered pizza delivery from Domino’s dozens of times (the corporate headquarters is located at the beautiful Domino’s Farms complex). One thing I started to notice as a poor college student was the $1 “Delivery Fee” tacked on to each order. I assumed that this surcharge was an automatic tip for the delivery drivers, and used it to rationalize my lack of generosity. (I have since learned the error of my ways, and that these fees are not tips.)
My naivety regarding the purposes of the delivery surcharge, however, is apparently not uncommon. The Eighth Circuit recently decertified a statewide class of Minnesota pizza delivery drivers based on a lack of commonality under Dukes, based on the different information customers received regarding whether a delivery fee constituted a “tip.” Luiken v. Domino’s Pizza, LLC, No. 12-1216, 2013 WL 399248 (8th Cir. Feb. 4, 2013).
The rationale deals with a particular quirk in Minnesota’s wage law, where a mandatory fee (such as the delivery charge in this case) can be considered a gratuity when a customer might reasonably see the charge as a payment for personal services and the employer fails to provide clear and conspicuous notice that the charge is not a tip. In Luiken, the drivers contended that the delivery charge must be considered a gratuity as defined by Minnesota law, because of people like me, yet they did not receive any portion of the surcharge. The district court agreed a certified a class of 1600 pizza delivery drivers.
The Eighth Circuit, however, found commonality was not satisfied under Dukes, repeating the mantra that “[c]ommonality requires the plaintiff to demonstrate that the class members suffered the same injury.” The court found that drivers did not often share the same circumstances in every pizza delivery transaction – some drivers explained to customers that the delivery charge was not a gratuity, negating the need for the employer to provide notice. Other drivers said nothing, and notice from the employer would have been necessary to apprise the customer that the charge was not a tip. Even Luiken himself was inconsistent, sometimes disclosing the purpose of the fee while other times staying silent. Even the circumstances of ordering pizza had an effect, depending on what a customer was told over the phone, in person, or on-line.
The moral of the story is to always tip your delivery drivers. The legal lesson is to examine the context of each transaction that is arguably at issue to see whether the circumstances are truly common enough to support the admonition in Dukes that “truth or falsity will resolve an issue that is central to the validity of each one of the claims in one stroke.”