FedEx Asks For Review of NLRB Employee Determination

 March 19, 2008

(Washington, D.C.) – FedEx Corporation [NYSE: FDX] subsidiary FedEx Home Delivery is defending its illegal contractor model in the U.S. Court of Appeals for the District of Columbia Circuit. 

In a brief filed Tuesday, FedEx Home Delivery is requesting a review of a National Labor Relations Board determination that drivers at two Massachusetts terminals are employees and not “contractors” as contended by FedEx.

The drivers at the two facilities overwhelmingly voted in October 2006 to join Teamsters Local 25. The NLRB ordered FedEx to bargain with Local 25, but FedEx refused to do so and filed the request for review in the Court of Appeals instead.

The D.C. Circuit is the highest court yet to hear a case on FedEx’s illegal contractor model. 

FedEx’s filing restates the many losing arguments that the company has tried in previous trials and hearings before the NLRB, civil courts and state and federal agencies. FedEx’s brief focuses on the false claims of “entrepreneurship” offered by the company and ignores the many control factors that directs the drivers as employees in practice.

“The National Labor Relations Board has repeatedly and rightly determined that FedEx Ground and Home Delivery drivers are employees, yet FedEx is trotting out the same failed arguments and false promises before the Court of Appeals,” said Teamsters General President Jim Hoffa.

“Instead of sitting down, negotiating a contract with these drivers that literally deliver profits to FedEx everyday and getting back to business, FedEx is repeating its mistakes,” said Local 25 President Sean O’Brien. “These drivers and Local 25 are ready to talk and get a contract, but FedEx insists on delaying the process and raising the stakes with an appeal that will only result in another legal setback to its scam contractor model.”

Massachusetts authorities repeatedly ruled that these same drivers are employees under state law. The state’s Department of Workforce Development ruled one driver was eligible as an employee for unemployment benefits. The Massachusetts Commission Against Discrimination ruled four drivers were employees and could pursue a claim. The Massachusetts Attorney General issued 13 citations against FedEx Ground for misclassification and fined the company $190,000 in an ongoing investigation.

The California Supreme Court and California Court of Appeal upheld a trial court’s 2005 decision that drivers in California were improperly classified as contractors. In December 2007, FedEx announced that an Internal Revenue Service audit also preliminarily determined that the drivers were employees and issued a $320 million back tax bill to the company.

FedEx’s brief and other documents are available at www.FedExWatch.com.

Founded in 1903, the International Brotherhood of Teamsters represents 1.4 million hardworking men and women in the United States, Canada and Puerto Rico.