FedEx Executive Touts Driver Rulings But Sees Fight Ongoing
May 13 2009 - 3:55PM
Dow Jones News
FedEx Corp. (FDX) isn't lowering its legal guard despite two
recent court victories regarding the employment status of its
delivery drivers, a company executive said Wednesday.
"I don't expect plaintiff attorneys to fold up their tents and
go away," said Rodger Marticke, chief operating officer of FedEx
Ground, speaking during a Robert W. Baird & Co. conference.
Still, he is optimistic the two cases will carry "significant
precedent value" and help FedEx Ground defend itself from a swath
of lawsuits challenging its use of independent contractors as
drivers.
Last month, a federal appeals court sided with FedEx Ground that
its drivers were properly classified as independent contractors, a
blow to efforts by the International Brotherhood of Teamsters to
organize them.
A Teamsters representative couldn't immediately be reached for
comment Wednesday, although the union previously has vowed to
continue pushing its legal case.
Earlier in April, a Seattle jury ruled in a separate case that
320 drivers weren't illegally denied overtime pay because they were
properly classified as independent contractors.
Marticke, whose comments were broadcast over the Internet, said
Wednesday he hopes the two cases - one in a state court and one in
federal court - will eventually help settle the legal wrangling in
FedEx's favor once a for all.
But he indicated the fight is likely to continue for the time
being, saying "there are people out there who would like to unravel
this model" for a variety of reasons.
In addition, FedEx Ground doesn't have an unblemished record in
defending its independent-contractor model. Late last year, FedEx
agreed to pay $26.8 million to settle a California lawsuit after a
state court ruled that 203 current and former drivers were
employees and not contractors.
FedEx shares recently fell $2.17, or 3.9%, to $52.89.
-By Bob Sechler, Dow Jones Newswires; 512-394-0285;
bob.sechler@dowjones.com