FedEx Ground Investigated by 8 State Attorneys General on Independent Contractor Status of Drivers
The media reported yesterday that the attorneys general for eight states informed FedEx Ground that it had formed a group to examine the company's classification of its drivers as "independent contractors," as opposed to "employees." The decision by the attorneys general is significant because FedEx Ground is currently defending multiple class action lawsuits filed by drivers across the country concerning the alleged misclassification of drivers as independent contractors. In fact, Gangemi Law Firm, P.C. represents a class composed of drivers working for FedEx Ground in New York State.
The attorneys general involved in the inquiry are from Kentucky, Iowa, Missouri, Montana, New Jersey, Ohio, Rhode Island and Vermont. Notably absent are the attorneys general from California and New York. Indeed, drivers in both California and New York have filed lawsuits against FedEx Ground challenging its classification system.
States are interested in the issue because FedEx Ground's classification of its drivers as independent contractors deprives states of unemployment insurance and workers' compensation premiums, as well as payroll taxes.
The lawsuit filed by our firm and co-counsel against FedEx Ground in 2004 is one of many filed across the country and seeks, among other things, a determination that drivers should have been classified as employees based upon the amount of control exercised over them by FedEx Ground. Moreover, if the drivers are really employees, then they should be reimbursed for many of their operating expenses, including lease payments on delivery trucks. New York law prohibits an employer from shifting its costs of doing business and risk of loss to employees, which could constitute unlawful deductions from wages under the New York Labor Law.
The New York action was original filed in New York State Supreme Court. It was then transferred to the United States District Court for the Southern District of New York. Finally, the case was transferred along with many others to the federal Multi-District Litigation Panel in South Bend, Indiana, where all of the cases are currently being heard.
For more information concerning the lawsuits filed by drivers in New York and other states, you can visit the FedEx Drivers Lawsuit website.
