Migliaccio & Rathod LLP is investigating whether Schmidt Baking, H&S Family of Bakeries, and affiliated bakery distribution operations misclassified certain route distributors as independent contractors and failed to pay overtime, minimum wages, and required business-expense reimbursements.
Schmidt Baking and H&S Family of Bakeries distribute bread, rolls, buns, and other baked goods to grocery stores, convenience stores, and retail outlets throughout the Mid-Atlantic region. Certain route distributors may personally collect products from company facilities, deliver them to assigned stores, stock shelves, rotate inventory, remove stale products, complete ordering and merchandising duties, and maintain company-required service standards. The memorandum identifies Schmidt Baking as a potential investigation target based on bakery-route distributor practices similar to those challenged elsewhere.
Although route distributors may be classified as independent contractors or operate through their own business entities, the practical working relationship may resemble employment where the company controls routes, assigned accounts, merchandising requirements, delivery schedules, and product offerings.
Reported Route Distributor Responsibilities and Expenses
Route distributors may have been required to:
- personally service assigned retail routes;
- obtain products from designated company facilities;
- deliver products to assigned grocery stores and retail customers;
- stock shelves, rotate inventory, and remove stale products;
- follow company merchandising and display requirements;
- complete ordering, inventory management, returns, and paperwork;
- provide and maintain delivery vehicles;
- pay fuel, insurance, maintenance, route financing, and equipment expenses;
- absorb losses associated with stale or damaged products; and
- work more than 40 hours per week without overtime compensation.
Why Route Distributors Should Be Concerned
Simply calling a worker an independent contractor does not determine whether the worker is legally entitled to employee protections. Courts generally examine the actual relationship, including the degree of company control, the worker’s opportunity for independent profit or loss, the permanence of the relationship, and whether the services performed are central to the company’s business.
Route distributors who personally perform deliveries while following company-established standards for stores, products, merchandising, pricing, and scheduling may have been improperly classified.
Distributors may also spend substantial uncompensated time loading products, stocking shelves, removing stale inventory, processing returns, ordering products, and completing administrative work.
Potential Claims May Include
- Independent-contractor misclassification
- Unpaid overtime
- Minimum-wage violations after business expenses
- Unreimbursed vehicle and operating expenses
- Unpaid loading, merchandising, ordering, and administrative work
- Improper stale-product or inventory deductions
- Unlawful shifting of business expenses and losses
- Recordkeeping violations
We Are Interested in Hearing From Current and Former Schmidt Baking or H&S Family of Bakeries Route Distributors Who:
- personally delivered bakery products to retail stores;
- operated through an LLC, corporation, or other business entity;
- serviced assigned routes or territories;
- had little control over products, pricing, promotions, or merchandising requirements;
- regularly worked more than 40 hours per week;
- paid fuel, insurance, maintenance, route, or equipment expenses;
- performed unpaid stocking, ordering, returns, or paperwork;
- experienced deductions for stale, damaged, or unsold products; or
- believe they functioned as employees despite being classified as independent contractors.
You may have rights even if your agreement referred to you as an “independent distributor,” “route owner,” “independent operator,” or contractor operating through your own company.
If you distributed Schmidt Baking or H&S Family of Bakeries products and believe you were improperly classified or denied wages or expense reimbursement, please contact Migliaccio & Rathod LLP. There is no charge to speak with us, and there is no obligation to take legal action.
If you believe you encountered these issues, we would like to hear from you. Please complete the contact form on this page, send us an email at [email protected], or give us a call at (202) 470-3520.