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October 21, 2020

Pizza Hut delivery drivers seek $320m in mileage underpayment claims

The delivery drivers of the US restaurant chain Pizza Hut have filed a lawsuit after being underpaid by NPC International, which operates the pizza chain.

The delivery drivers of the US restaurant chain Pizza Hut have filed a lawsuit after being underpaid by NPC International, which operates the pizza chain.

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The delivery drivers said that NPC International defrauded them on payments for using their own vehicles, Bloomberg reported.

According to a court filing on Monday, the multi-franchise operator was alleged to have underpaid the drivers by $4 to $12 per hour.

NPC reportedly reimbursed only $0.25 to $0.35 per mile while the mileage reimbursement rate set by the Internal Revenue Service is $0.57 cents a mile.

A total of more than $320m is expected to be paid by NPC International in claims, the report added.

Additionally, the drivers said that number of miles they drove was also undercounted and the top officials were aware of the shortchanging.

However, their claims are temporarily held by the court as the operator’s reorganisation proceeds.

NPC, which previously operated over 1,225 Pizza Hut outlets in 27 states and 385 Wendy’s locations, filed for bankruptcy in July.

At that time, the company said that it was struggling to keep the drivers due to the rise in demand for deliveries amid the Covid-19 pandemic. That meant fewer drivers were available, and because of plummeting demand for its own products, tips were cut down.

“As a result, the company has no other option but to increase wages to retain delivery drivers,” it stated in a document filed in relation with bankruptcy.

Free Report
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Meet emerging digital demand in the foodservice industry

Global digital pressures are making waves across sectors. The foodservice industry is seeing particular impact as consumers change the way they operate. It is therefore essential to know how to navigate the challenges that digital is presenting to the industry and its consumers. GlobalData’s free report explores the market outlook for the global foodservice industry, with insights into how foodservice operators, brands, and their suppliers can meet changing demands. Key features in this report include:
  • An overview of dine-in, takeaway, and delivery forecasts up to 2026
  • Areas foodservice industry players should be focusing on for digital investment
  • Consumer insight into attitudes towards digital convenience
  • Challenges facing foodservice, in terms of investment and logical considerations
  • Key examples of top industry players
Adapt and stay on top. Download our free report now.
by GlobalData
Enter your details here to receive your free Report.

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