Some Private Contractors Sue Fedex Ground for Employee Status, Benefits
Dallas-based RedNova, an online news source, reported this week FedEx Ground is embroiled in a labor fight with the independent contractors who own their trucks, pay all operating costs and get no company benefits
Dallas-based RedNova, an online news source, reported this week FedEx Ground is embroiled in a labor fight with the independent contractors who own their trucks, pay all operating costs and get no company benefits.
According to RedNova, drivers in Tennessee, California, Massachusetts, Minnesota, South Dakota and elsewhere are suing FedEx, arguing the company skirts worker protection laws by refusing to hire them as employees eligible for overtime pay, health insurance, workers' compensation and other benefits. They also want to be reimbursed for back operating expenses and lost benefits.
FedEx Ground had its beginnings in the Roadway Package System, which was acquired by FedEx in 1998 and re-branded in 2000 as FedEx Ground headquartered in Pittsburgh.
The unit brought in almost $4.7 billion in revenue out of FedEx Corp.'s $29.4 billion total for the last fiscal year that ended May 31. The company has consistently described the FedEx Ground division as one of the primary reasons for a steady increase in corporate earnings. Ground's operating income grew 16% to $604 million in fiscal 2005.
Spokesman Perry Colosimo said FedEx Ground is confident it can win in court and has no intention of changing the way it does business.
The drivers say FedEx controls just about everything they do - the hours they work, where and when they pick up or deliver packages, how they maintain their trucks, even how they dress. FedEx also prohibits drivers from using their trucks to carry non-FedEx shipments.
"They're calling these drivers independent contractors, but they're really employees," said Christopher Gilreath, a lawyer for a group of Memphis drivers who filed suit against FedEx in federal court last month.
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