By Mike Esterl 

FedEx Corp. said Thursday it has agreed to pay $240 million to settle lawsuits in 20 states with drivers, possibly ending a yearslong legal dispute over whether they were employees or independent contractors.

The settlement requires final court approval and would affect roughly 13,000 drivers, according to a company spokesman.

"We are pleased to put this matter behind us as it relates to a contract that has not been in use for a number of years," FedEx said in its statement.

The Memphis, Tenn., delivery company disclosed in March that it had reached agreements in principle to settle 19 cases for a net loss of $204 million. Thursday's $240 million figure includes a separate settlement in Kansas.

Plaintiffs filed motions Wednesday for preliminary approval of the terms in the U.S. District Court for the Northern District of Indiana, which is overseeing the multistate litigation.

FedEx formerly hired drivers as independent contractors. Drivers sued the company, arguing they were employees and entitled to more benefits.

The company changed the practice in 2011, when it stopped hiring drivers directly and signed contracts with companies that employ drivers.

FedEx also agreed in June 2015 to settle a similar case in California for $228 million.

Write to Mike Esterl at mike.esterl@wsj.com

 

(END) Dow Jones Newswires

June 16, 2016 20:44 ET (00:44 GMT)

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