FedEx settles misclassified drivers employment dispute for $228M

It was a happy day for a group of California drivers for FedEx Ground who finally are receiving justice. The drivers now have a conclusion to their employment dispute after a decade. The case -- originally filed in 2005 -- represented 2,300 workers who claimed they were classified as independent contractors when they should have been employees.

According to the complaint, the drivers were not classified properly and because they were not considered employees, they were denied the associated benefits. The drivers were not entitled to being paid overtime or to be given their legally mandated rest periods. This case was only representative of the affected drivers who worked for FedEx in California between 2000 and 2007.

FedEx finally decided to settle after the federal 9th Circuit Court of Appeals decided in favor of the drivers in 2014, determining that they should have been considered employees. A 7th Circuit Court of Appeals made the same decision when another group of drivers in another state had the same complaint. The ruling decided that those drivers should also have been employees. Both of these courts were one step from heading to the Supreme Court.

A $228 million settlement was reached for the California drivers. According to a FedEx representative, other employment dispute cases against the company will be heard independently. As a way to reduce payroll and other costs, some companies will choose to declare employees independent contractors illegally. Similarly situated workers who question if they are incorrectly classified as independent contractors should consult with an experienced professional to pursue the appropriate claims.

Source: ccjdigital.com, "Court approves FedEx's $228M settlement with drivers, resolving 'misclassification' claims", James Jaillet, Oct. 16, 2015

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