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Last week the U.S. Court of Appeals for the District of Columbia decided that FedEx Home workers are entrepreneurs and not employees, and therefore they cannot organize a union.
The day after the decision was made, Ken Hall, Teamsters International Vice President and Director of the Teamsters Package Division said, “We are disappointed in the court’s decision to deprive FedEx drivers of the right to form unions and bargain for better working conditions and wages, leaving them at the mercy of this notoriously anti-worker company run by a member of the Forbes 2008 Billionaires Club. We are confident that the decision will not survive review by the full court or by the U.S. Supreme Court. “
This is about the misclassification of workers.
The NY Times reported that “the ruling was FedEx Home’s biggest victory in a series of disputes with the Teamsters union, class-action lawyers and state officials over whether it had misclassified its drivers as contractors rather than employees to deny them various benefits and the right to unionize.”
The court found that the FedEx Home’s drivers have “entrepreneurial potential” and can operate multiple routes and sell routes as well as hire helpers and additional drivers, and therefore should be considered independent contractors.
Clearly the workers at FedEx Home don’t agree. In fact, last December the company agreed to pay $27 million to settle a misclassification lawsuit brought on behalf of 203 drivers in California. In that particular suit, a state judge wrote that FedEx Ground had “close to absolute control” over the drivers, adding that the operating agreement they signed was a “brilliantly drafted contract creating the constraints of an employment relationship” disguised in the independent contractor model. Interesting it would be so terribly different on the other side of the United States.
The case that was decided upon earlier in the week centers on FedEx Home drivers in Massachusetts. After the National Labor Relations Board (NLRB) sided with the union, FedEx filed a challenge in the appeals court.
In the 2-1 ruling, the court decided that the company did not have to bargain with the Teamsters even though an overwhelming majority of the drivers at two Massachusetts terminals voted to join the Teamsters.
The Teamsters’ Ken Hall said, “[The Union’s] fight on behalf of these workers will not stop. We remain committed to those FedEx drivers who have sought the protection of a legitimate collective bargaining agreement to improve their lives.”
Aside from the fact that some 4,000 working people who chose to collectively bargain are being barred from this American right, the Court’s ruling disregards the common-law test to determine employee status – which led to the finding that the drivers are employees.
“FedEx clearly controls the daily existence of the driver,” Hall said.
Who judged?
In the ruling, Judge Janice Rogers Brown, an appointee of George W. Bush, and Judge Stephen F. Williams, a senior judge appointed by Ronald Reagan, signed the majority opinion. Judge Merrick B. Garland, who was appointed by Bill Clinton, dissented, writing that the drivers should be considered employees.
Judge Garland wrote that the drivers hardly had any “entrepreneurial opportunities.” He argued that the company puts limits on drivers’ ability to sell routes and freely change up their routes.
In the end, the fight will continue for these workers. The Teamsters aren’t going to let this setback court ruling deter them from doing what is right by these FedEx employees who, as all Americans, deserve the right to collective bargaining.
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Pro-Corporate Judicial Activism
This was a very bad decision, not only for these particular workers, but also for anyone who believes that courts ought to enforce existing laws that protect workers' rights.
Judges Brown and Williams essentially disregarded years of precedent, under which the NLRB and the courts have consistently ruled that the question of employee v. independent contractor statuts turns on the overall factual nature of the working relationship. Instead, these two judges singled-out one factor -- so-called "entrepreneurial opportunity" -- and asserted, contrary to past decisions, that this one factor trumped all the other ways in which FedEx Ground pervasively controls every detail of the drivers' work, right down to the color of their socks! Of course, as the drivers know, and as the NLRB and the dissenting Judge Garland agreed, the drivers' supposed "entrepreneurial opportunity" is largely an illusion given the tight control that FedEx Ground exercises. But even if it were real, it would still be only one factor, and not a sufficient basis on which to overturn the NLRB's decision.
This decision highlights the need for federal legislation to clarify the employee/contractor distinction, so that corporations like FedEx Ground cannot continue to use sham "contractor" schemes to deprive workers of their legal rights and protections. Along with the EFCA, such legislation would go a long way toward restoring some degree of fairness in a system that is now heavily tilted in favor of employers.
(Full disclosure: I previously represented FedEx Ground and Home Delivery drivers in their ongoing federal class action lawsuit over their misclassification as "independent contractors". I am no longer in active legal practice and no longer involved in the case.)
Thanks for this
I really appreciate having someone who understands the law visiting UnionReview.com -- and I am guessing many others would say the same.
Thanks for putting this in perspective, it means a lot.
Right and wrong
Why does discerning the difference between right and wrong disappear when corporate favors sneak into the pockets of the bribed? Evidently, judicial doesn't necessarily mean justice anymore.