Court Backs FedEx on Drivers’ Status

FedEx Corp.’s small-package delivery drivers may be classified as independent contractors and not company employees, a federal appeals court ruled Tuesday, Bloomberg reported.

Because its FedEx Ground unit’s drivers can operate multiple routes, hire extra drivers and sell their routes without company permission, they should not be classified the same as employees of traditional trucking companies, the U.S. Court of Appeals in Washington ruled, Bloomberg said.

“We have considered all the common law factors, and, on balance, are compelled to conclude they favor independent contractor status,” the court wrote in its decision, vacating a previous National Labor Relations Board order.

A Seattle jury ruled late last month that FedEx did not illegally deny overtime pay to 320 contract drivers who accused the company of considering them to be contractors while treating them like employees. (Click here for previous coverage.)

FedEx Ground uses a contractor model for its ground deliveries in competing with UPS Inc. Contract drivers have sued the company, claiming they should be treated as full-time employees and receive regular benefits, Bloomberg reported.

UPS drivers are employees of that company and are represented by the Teamsters union under a union contract.

FedEx, which has about 290,000 workers and contractors, said last month it would cut an unspecified number of jobs in attempting to cut $1 billion in costs. The company trimmed 900 positions at its less-than-truckload FedEx Freight unit earlier this year.

FedEx Corp. is ranked No. 2 on the Transport Topics 100 listing of U.S. and Canadian for-hire carriers.