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Nov
2014
12

Kansas Supreme Court Becomes Latest Legal Body to Slam Fedex’s Misclassification Practices

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The Supreme Court of Kansas has ruled that workers classified as independent contractors by FedEx Ground were in fact employees entitled to the labor protections.  The case, Craig v. FedEx Ground Package Sys. Inc., used two separate tests to determine the legitimacy of the company’s claims that it was hiring independent contractors.  The outcome of this determination shifted the responsibility of costs endured during the workday from worker to management.  

Background is provided by the Orange County Employment Lawyers Blog.

Drivers were seeking a judicial determination that they were entitled to all costs and expenses they spent while working for defendant and repayment for all overtime wages that they were never paid.

Drivers claimed they were entitled to this relief under both state and federal employment law. Both parties filed cross-summary judgment motions. As our attorneys in Orange County who handle employee misclassification matters can explain, a motion for summary judgment is a essentially a claim that, even if all evidence is viewed in the light most favorable to the nonmoving party, there is no case for the jury to decide. If the motion is granted, the case, or some of the claims, will be dismissed.

The determination was made using the “control test” and the “economic reality test.”  Both legal tests, explained below, use a set of criteria to determine if the independent contractor is truly independent:

Using the control test and the “economic reality” test, the court looked at the degree of control exerted by the alleged employer, workers’ opportunity for profit and loss, workers’ investment in the business, skill required of the workers, and how essential workers were to the employer’s total operations.

The court considered the fact that drivers were required to wear company uniforms, use company scanners, company forms marked with their logo, trucks obtained from company authorized providers and financed through the company with payments deducted from their weekly paychecks, drivers’ supervisors scheduled deliveries without consulting the drivers, and other similar controlling factors.

Quoting the California case, Estrada v. FedEx Ground Package System, Inc., the court stated that defendant’s operating agreement was brilliantly crafted to hire employees under the guise of calling them independent contractors

Further citing the California Court of Appeal, the court held that defendant’s conduct spoke even louder than their words as it exercised what amounted to total control over every aspect of drivers’ work.

The California case being referred to resulted in a whopping 2,300 drivers being reclassified. Fedex has been beaten up in court this year. Misclassified drivers in Maine received nearly $6 million this summer.

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