Kansas Supreme Court finds FedEx Ground misclassified drivers

By Clarissa Hawes, Land Line staff writer | 10/10/2014

A recent ruling by the Kansas Supreme Court has found that FedEx Ground drivers were improperly classified, stating in its decision that the drivers are actually employees, not independent contractors, as originally labeled by the company.

In July, the Court of Appeals for the Seventh Circuit had asked the high court in Kansas to rule on two questions. The first question was whether drivers would be considered employees of FedEx Ground under the Kansas Wage Payment Act, or KWPA.

The high court found that FedEx Ground controlled nearly every aspect of its drivers’ workdays and their ability to make a living, “dictating the driver’s required expenditures for vehicles, tools, equipment and clothing.”

“Viewing the factors as a whole leads to the conclusion that FedEx has established an employment relationship with its delivery drivers, but dressed that relationship in independent contractor clothing,” the high court in Kansas stated in its decision. “Consequently, we hold that under the undisputed facts presented, the FedEx delivery drivers are employees for purposes of the KWPA.”

The second question to the appeals court asked whether the answer to the first question would change if the drivers had acquired more than one route for which they were not the driver. The high court answered no to the reformulated question.

“In other words, the employer/employee relationship between FedEx and a full-time delivery driver with respect to the assigned service area is not terminated or altered when the driver acquires an additional route for which he or she is not the driver,” the high court stated in its opinion.

More than 470 drivers for FedEx Ground in Kansas, the lead case in more than 21 consolidated class action lawsuits, claim they were not paid for overtime and expenses. Drivers in that case appealed a 2010 ruling by a federal judge in Indiana, who sided with FedEx that it had properly classified its drivers.

In a statement by FedEx, the company disagreed with the Kansas Supreme Court’s recent ruling on the two questions.

“We fundamentally disagree with this ruling and are committed to protecting the rights of thousands of independent business owners to continue owning and operating their businesses,” FedEx Ground said in statement.

In late August, a federal appeals court in California ruled that approximately 2,300 drivers for FedEx Ground were actually employees of the company, having been improperly labeled by FedEx as independent contractors under California law.

“We hold that plaintiffs are employees as a matter of law under California’s right-to-control test,” the Ninth Circuit Court of Appeals wrote in its ruling on Wednesday, Aug. 27.

In a statement to Land Line, Beth A. Ross, attorney for Leonard Carder, which represented the drivers, claims FedEx Ground may owe its drivers “hundreds of millions of dollars for illegally shifting to them the costs of such things as the FedEx-branded trucks, FedEx-branded uniforms and FedEx-branded scanners, as well as missed meal and rest period pay, overtime compensation and penalties.”

While the company controlled nearly every aspect of their businesses, the FedEx Ground drivers also claimed they made far less than employee drivers who worked for FedEx. They did not receive important employee benefits like health care, workers’ compensation, paid sick leave, vacation and retirement.

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