• Delivery drivers feel economic pinch

    Tags: Delivery
Delivery drivers feel economic pinch
While pizzeria operators have seen their profits squeezed by the rising prices of cheese and flour, another segment of the industry also has been hit hard by current economic conditions.
 
Delivering pizzas has long been an attractive way for people from students to retirees to make some quick cash. Lately, though, rising gas prices and impending wage cuts have made delivery driving considerably less lucrative.
 
A number of delivery drivers expressed their frustration with current economic conditions in response to questions posed on www.tipthepizzaguy.com, an Internet discussion board for pizzeria workers. The mileage reimbursement drivers receive hasn't kept up with gas prices, they say.
 
"My store pays 90 cents per run, and that's the most it's ever paid," said "Soldier," a driver for a Domino's franchisee in Macomb, Ill. "It only rose to that when gas topped $3.30 a gallon in May 2007, and gas has been $3.99 a gallon here this year since at least May 22."
 
Soldier's pizzeria paid 65 cents per run when gas was $1.15 a gallon, or more than 50 percent of the cost of a gallon of gas for each delivery. Now, the driver reimbursement is less than 25 percent of the cost of a gallon.
 
And other drivers concurred with Soldier's assessment.
 
"My store pays a sliding scale based on the cost of gas, but it has hit its peak and (the mileage reimbursement) will no longer increase at all," said Casey, a delivery driver from Flagstaff, Ariz. "At this point, drivers are being paid somewhere between 15 and 30 cents per gallon, depending on how lucky they are with their runs."
 
Delivery drivers generally are paid in a combination of an hourly wage, a mileage reimbursement and tips. Add all three together and drivers can make $10 per hour or more.
 
Out of that, though, drivers pay for their own gasoline, car maintenance and insurance.
 
The mileage reimbursement, or "run money," paid to drivers varies from store to store, even within pizzeria brands. Reimbursements generally range from 75 cents to $1.25 per delivery, depending on the operation.
 
"Driver reimbursements are up to the individual employer, or the franchisee," said Tim McIntyre, spokesman for Ann Arbor, Mich.-based Domino's Inc. "Given the volatility of prices these days, many have instituted sliding scales."
 
And while some operations have added or reinstated delivery fees, that money has had little, if any, impact on mileage-reimbursement increases.
 
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The nationwide average for regular unleaded gasoline was $4.09 per gallon June 30, according to AAA and the Oil Price Information Service. Prices are up 38 percent from an average of $2.96 per gallon this time last year.
 
Wage cuts also an issue
 
Many drivers also are facing wage cuts as operators consider changing pay scales in the wake of a July minimum wage hike. Rather than pay drivers at or above the minimum wage, several companies are considering a switch to a wage-tip credit system, similar to the manner in which restaurant servers are paid.
 
Under a wage-tip credit system, drivers would be paid less than minimum wage during the time they are on a delivery, with their tips credited to make up the difference.
 
According to delivery drivers working for PJ United, a Birmingham, Ala.-based Papa John's franchisee, the company is considering the switch to a wage-tip credit pay system when minimum wage increases to $6.55 on July 24. Signs protesting the change have been appearing in front of Papa John's stores owned by PJ United.
 
PJ United hasn't commented publicly on the pay change, but they are taking steps to speak with delivery drivers about the issue.
 
"The company has meetings set up all week to talk with drivers about the wage-tip credit situation," said Steven Savage, a regional director with the American Union of Pizza Delivery Drivers. "There are a lot of very upset drivers."
 
Understandably, drivers see the issue as one of their biggest concerns.
 
"Gas reimbursement and the specter of sub-minimum wage pay are the two biggest concerns to drivers right now, bar none," said "Lonestar," a delivery driver with more than 20 years' experience. "Minimum wage and IRS mileage rates are the least that are acceptable in this industry. Anyone who thinks they can't pay that should think about getting out of the business."

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