MDL Class Notices Mailed; FedEx-IRS Talks Ongoing

There were two major updates involving FedEx Ground’s legal challenges in the past week.  On the June 18 quarterly conference call, FedEx Corporation’s General Counsel Christine Richards answered a question about the company’s talks with the IRS: “We’ve started those conversations. At this point in time there’s a good chance they’ll continue on into the first quarter. We’re still at the audit level and depending upon the outcome at that level, we will then see how we go forward.” In the multi-district litigation, the plaintiffs’ lawyers announced that class notices for “27,165 past and present FedEx Ground/Home Delivery drivers across the U.S.” were mailed on June 25.

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Expert Report in MDL Says Drivers are Employees

A valuable plaintiffs’ expert report was submitted to the Northern Indiana courts and found its way onto the public docket.  Robert W. Wood is “author of Legal Guide to Independent Contractor Status originally published in 1992 now in its Fourth Edition” and “author or editor of 31 books and over 1,000 articles published in legal, accounting and business periodicals.” Wood has often been “engaged to help clients establish bona fide independent contractor arrangements” and “drafted, edited or assisted in drafting dozens of independent contractor agreements over nearly three decades.” Wood has “argued far more frequently for independent contractor (rather than employee status) of workers.  Woods’ conclusion in his report? “FXG’s drivers are the cornerstone of its enterprise.  To a truly extraordinary degree, drivers are integrated within FXG’s global system...In my opinion, plainly, unequivocally, and without qualification, the P&D drivers do not (and cannot) constitute bona fide independent contractors under any existing test for assessing worker status.” Wood’s report is uploaded on our Resource page.

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Litigation (Archives)

FedEx Ground vs California Employment Development Dept. Division | Ground | Contractor Dispute | State Litigation | California | |

This case stems from the California Employment Development Dept. audit of FedEx Ground in 2004 where the EDD determined that FedEx Ground drivers were employees.  The EDD assessed FedEx Ground owed more than $7.88 million in back payments to California.  As of November 2006, California Unemployment Insurance Appeals Board denied FedEx Ground’s petition for reassessment; the EDD audit determination that single route drivers are employees stands and FedEx Ground has 30 days to appeal.

Tumulty vs FedEx Ground Contractor Dispute | Federal Litigation | Wage Hour | Washington | |

This case was filed in King County (WA) Superior Court in 2003 and removed to U.S. District Court for Western Washington in 2004.  The plaintiffs alleged that FedEx Ground, a staffing agency and a multi-route contractor were joint employers under the Fair Labor Standards Act and Washington Minimum Wage Act.  In March 2005, the judge issued a summary judgment that FedEx Ground was the joint employer of the plaintiffs.  The case was settled in Sept 2005.  FedEx immedeiately appealed the summary judgment to the Ninth Circuit; the appeal is pending (USCA 05-36072).

Lester vs FedEx Ground Division | Ground | Class Action | Contractor Dispute | Federal Litigation | Michigan | |

This case was filed in U.S. District Court for Eastern Michigan in 2004.  This case is a member case of the FedEx Ground/Home Multi-District Litigation case.

Federal Regulation Docs (Archives)

Lucey et al Vs FedEx Ground Arbitration Clause | Federal Litigation | New Jersey | |

This case originated in Superior Court for New Jersey Burlington County in 2006.  FedEx was granted a removal order to U.S. District Court for New Jersey but was not granted a motion to move it into the multi-district litigation proceedings.  FedEx moved to compel arbitration and the plaintiffs opposed by claiming the arbitration clause of the FedEx Ground “Operating Agreement” was unconscionable.  In October 2007, the Judge ruled that the arbitration clause was both procedurally and substantially unconscionable.

Teamsters Local 671 and FedEx Home Division | Ground | NLRB | Teamsters | Unionization | Connecticut | |

Teamsters Local Union 671 filed a petition for an election at the FedEx Home Delivery Terminal in Windsor, CT in February 2007.  NLRB Region 34 Director Hoffman issued a decision that the single vehicle contractors were employees and eligible to vote in an election.  The vote was held on May 11 and ballots were counted on June 1.  The drivers voted 12 - 9 to join Local 671.  NLRB certification is pending.

Teamsters Local 804 and FedEx Ground Division | Ground | NLRB | Teamsters | Unionization | New York | |

This case stems from a petition for election filed with the National Labor Relations Board by Teamsters Local 804 in 2001 at a FedEx Ground facility in Maspeth, NY.  The NLRB Region 29 decided in May 2001 that the drivers were employees and not “contractors” as claimed by FedEx Ground.