The National Labor Relations Board delivers labor jab to FedEx
The National Labor Relations Board’s certification of a union vote last week involving FedEx Home Delivery drivers in Wilmington, Mass., could add a layer of intrigue to a case that pits the independent-driver model against the more traditional employee model.
Drivers in the Home Delivery division in Wilmington last October voted 24-8 to choose the Teamsters as their bargaining representative.
By intervening, the NLRB said it agreed that the drivers are employees and not independent contractors, according to Patricia Gilbert, NLRB spokeswoman in Washington.
The decision was made by the regional director in Massachusetts.
The ruling could have a modicum of influence, experts say, on a larger case coming before a federal judge in the Southern District of Indiana over whether 35 consolidated suits brought by drivers in 30 states can move forward as a class-action suit.
FedEx says the 15,000 people who drive its courier vehicles with the purple and green FedEx painted on the side are independent contractors running their routes as they see fit.
They own their own trucks and pay all expenses, including fuel and maintenance.
But a growing number of the drivers say they are really employees, paid like contractors, who have given FedEx an edge over rival UPS, which employs Teamster drivers.
Drivers in Tennessee, California, Massachusetts, Minnesota, South Dakota and elsewhere are suing FedEx, arguing the company shirks worker protection laws by refusing to hire them as employees eligible for overtime pay, health insurance, workers’ compensation and other benefits. They also want to be reimbursed for back operating expenses and lost benefits.
Chris Gilreath, who represents the five plaintiffs in the Memphis case, says the Massachusetts ruling will give “other drivers hope that they can come together and have a unified voice.”
FedEx Ground, based in Pittsburgh, was created in 1998 as a way to diversify FedEx Express, the world’s largest cargo airline. Today, the division is one of the fastest growing units at FedEx Corp, accounting for 17 percent of revenue. In the fiscal year ended May 31, it grew 14 percent to $5 billion.
Its independent-contractor system promotes huge efficiencies, saving it equipment, insurance and benefits costs. But the structure also keeps drivers from organizing, experts say.
A victory by the unhappy drivers would raise employee costs and force FedEx Ground to maintain its own fleet of trucks.
Since 2001, NLRB regional offices have ruled six times that FedEx Ground and Home Delivery drivers are not independent contractors, giving them the right to form a union.
In order to get a court review, FedEx says it will refuse to bargain with the new Teamster group in Massachusetts, forcing the union to file a grievance.