Independent drivers sue FedEx for benefits

| Monday, July 25, 2005

Independent truckers in at least five states are suing FedEx Ground, saying the company is skirting federal worker-protection laws by refusing to recognize them as employees who are entitled to full benefits.

Drivers in Tennessee, California, Massachusetts, Minnesota, South Dakota and elsewhere are suing FedEx, The Associated Press reported.

According to the Indianapolis Star, FedEx officials say their 14,000 independent drivers are not eligible for the benefits because they’re independent contractors. Spokesman Perry Colosimo said FedEx Ground uses the independent contractor system because it keeps FedEx customers’ costs down and allows drivers to run their own businesses.

Christopher Gilreath, a lawyer for a group of Memphis drivers who filed suit against FedEx in federal court last month says they’re clearly employees – with the company controlling their hours, routes, truck maintenance and how they dress.

The truckers are responsible for their own operating expenses, but FedEx prohibits them from using their trucks to carry non-FedEx shipments. They want to be reimbursed for back operating expenses and lost benefits.

More than a dozen similar suits are in the works or already filed around the country, The AP reported. The lawsuits involve small groups of current or former drivers. Some plaintiffs have already sought class-action status that could expand the reach of court rulings.

Last year, a California state court ruled that one category of contract drivers for FedEx Ground should be treated as company employees. FedEx has said it will appeal.

The labor fight could raise operating costs for FedEx Ground by millions of dollars and lead to an overhaul of its work force.

FedEx Ground, headquartered in Pittsburgh, was created seven years ago amid a reorganization of its parent company, which also owns FedEx Express, the world’s largest cargo airline. The ground transportation unit brought in almost $4.7 billion of FedEx Corporation’s $29.4 billion total for the fiscal year that ended May 31. The operating income for FedEx Ground grew 16 percent to $604 million in fiscal 2005.

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