Ground to absorb Express

[dmac1]

Okay, I hadn't paid much attention to it but was under the assumption that's what had happened.



I don't know how FedEx is responsible for another company's unpaid wages.

They are claiming that fedex is the actual employer and that the ISP plan is really just a scam. Fedex still controls everything a driver does, except their hours of work. Even pay, indirectly. They still wear fedex uniforms, deliver fedex packages, have to follow fedex rules of things like no one else in the vehicle, they use fedex scanners, drive trucks under fedex control. In essence, they are just like fedex express employees for the most part. The public can't tell them apart. Only the scheme makes them any different.

 

[dmac1]

It’s a bit convoluted for an argument. They claim FedEx hires employee drivers through intermediaries known as ISPs. Then controls those drivers making Fedex a co-employer. For my company that argument is total nonsense. I can envision a scenario where it is closer to reality with local management sticking their nose into a failing contractor’s business to try and save service. I don’t find the arguments compelling and I don’t think it’s applicable as a class, there aren’t that many drivers operating vehicles under 10k lbs.

In this case, there is no real difference in whether you drive over/under 10k as far as whether fedex drivers are employees of fedex, except that in this case they are asking for OT pay. In another case, it might be the FICA tax/witholding issue. In this case, the OT is the issue, thus only under 10k. So that's where the class eligibility was drawn. Fedex could solve that one issue easily by requiring only vehicles over 10k, but then that adds more control.

And you can't say that you treat your drivers with no regard for fedex demands, and those demands, whether contracted or not, give fedex some measure of control over even tyour employees, no matter how great you are.

I've been through 3 cases where CONTROL is the main issue, and fedex lost all three. Even where I hired, paid, set routes(withing fedex limits), supplied vehicle(again within fedex limits), 'my' drivers were determined to be fedex employees, and fedex never fought it. The court saw the ISP plan as just a cover for fedex avoiding responsibility.

 

[bbsam]

In this case, there is no real difference in whether you drive over/under 10k as far as whether fedex drivers are employees of fedex, except that in this case they are asking for OT pay. In another case, it might be the FICA tax/witholding issue. In this case, the OT is the issue, thus only under 10k. So that's where the class eligibility was drawn. Fedex could solve that one issue easily by requiring only vehicles over 10k, but then that adds more control.

And you can't say that you treat your drivers with no regard for fedex demands, and those demands, whether contracted or not, give fedex some measure of control over even tyour employees, no matter how great you are.

I've been through 3 cases where CONTROL is the main issue, and fedex lost all three. Even where I hired, paid, set routes(withing fedex limits), supplied vehicle(again within fedex limits), 'my' drivers were determined to be fedex employees, and fedex never fought it. The court saw the ISP plan as just a cover for fedex avoiding responsibility.

If it’s that simple, you’d think lawyers would be lining up to bring suit.

 

[dmac1]

First the end game is to create a pathway to cheap trucking and cheap labor.


Overtime? Never. Benefits?

Fedex will try to use the ISP to avoid liabilities- like FICA taxes, worker's comp, legal responsibility for damages and losses, etc. Unionization was a big part of going to multi-route ownership and ISP. When fedex saw that the IC was not going to last, and some ICs formed groups, and even voted on unionizing, they threw the ISP monkeywrench into the mix. They don't 'want' ISPs, they are just using the plot to avoid costs. Long-term, it has pitfalls of its own.

 

[dmac1]

If it’s that simple, you’d think lawyers would be lining up to bring suit.

You should know better.

Any attorney is going to look at how long the first case lasted and think long and hard. And there are different laws in each state, making a national class action very difficult.

I predict that California will again be the first because there are enough drivers in California to make enough money on. Plus there has to be enough drivers at any one time who can show enough damages to make it a class action.

No attorney in a small state with maybe 400 drivers total with maybe $2000 per driver of provable 'damages' is going to want to spend millions as fedex uses the courts to make it take as long as possible. The last case went from state courts to fedex demanding consolidation into a national class to the national class sending some cases back to the states, dismissing some, with fedex ALWAYS taking the maximum time at each step, then appealing each negative decision, no matter how small, turning a case that ended up as a slam dunk once it got back to the state, at least in my case.

 

[59 Dano]

I still think fedex can combine the divisions and through efficiencies they can then enforce using all employees, fedex can be more profitable.

Nothing could be further from the truth. Ain't no way they're going to increase profitability by taking on the risk, liability, and expense of delivering Ground packages.

 

[bbsam]

Nothing could be further from the truth. Ain't no way they're going to increase profitability by taking on the risk, liability, and expense of delivering Ground packages.

Because UPS is going broke?

 

[Exec32]

I don't think any court ever told fedex how they needed to change. Courts generally just decide on the legality of what is presented to them. I followed the court cases pretty closely, but not compulsively, plus it's been 13 years since I went into the courts with/against fedex.


Fedex made changes that they felt they could get away with, nothing else, and those changes were meant to make it harder for anyone to get an attorney to fight for them. Fedex gave up none of the control that was the issue with 'individual' contractors, and I know for a fact that in Oregon it didn't even matter if you 'owned' multiple routes. I owned 'multiple' routes and hired drivers, and was found to be an employee of fedex. My drivers were also found to be employees, although fedex never fought on that point. Control was THE issue. But instead of fighting to the end, and FEDEX being required to change, the attornies tired of the fight and settled, taking it out of the court system. So the case basically dropped out of the court system, and until and unless at least two ISPs can find an attorney to take a case that will takes years, fedex is safe from the ISPs. And my case was based on state laws that don't apply in most other states.

My opinion is that it will end up being drivers who have problems with their ISP who end up with the best chance of ending the ISP plan. Or when enough drivers kill enough children, or murder or rape enough customers, and courts find fedex liable enough times. the cost of avoiding the liabilities might outweigh the savings. If the public was really aware of fedex drivers being treated like crap, instead of believing fedex was the ideal employer, and some boycott materialized, the bad publicity might also be a catalyst for change. Maybe a combination of all these circumstances will happen, and hasten the ISP demise, or maybe it will never happen.

I still think fedex can combine the divisions and through efficiencies they can then enforce using all employees, fedex can be more profitable.

You are correct about the element of control becoming the issue X could not get around. There is also the issue of economic dependence that has presented itself.
Another problem that exists is the conduct of FedEx. Make no mistake about it, every contractor here has been subject to it, but material breaches in the agreement are done every day at every terminal across the country. The problem is most contractors are contributory, others are ignorant, and the final few are to broke to do anything about it. That's where a contractor that is not in debt, trucks paid for, nothing to lose takes X to task. I also agree it will be the drivers that will become the primary concern, and a threat to X control.

 

[Exec32]

Nothing could be further from the truth. Ain't no way they're going to increase profitability by taking on the risk, liability, and expense of delivering Ground packages.

Efficiencies ,,,,are not only monetary.
The real long term value that X is seeking is something quite different..

 

[dmac1]

Ain't no way they're going to increase profitability by taking on the risk, liability, and expense of delivering Ground packages.

Simply eliminating having 2-3 or more drivers in each area could decrease costs. For the greatest % of packages, if delivery areas were 1/3 to 1/4 the size, drivers would be able to meet deadlines for pickup and delivery windows while avoiding long double backs. Eliminating the double terminals(ground and express) is further savings. A big reason fedex doesn't do that is because of the unionizing law exemption they have as an 'airline' but at some point, I could see a challenge to that, because fedex has now a huge part of their entire business on the ground. They only keep the divisions separate on paper, and someday could face a challenge as to why fedex deserves a special exemption that competitors don't have. Fedex isn't home free regarding the ISP model just because they paid off the former drivers and attorneys

 

[dvalleyjim]

I still believe that the ISP model can be overcome by the right lawsuits. But it will take years and if successful could undo many franchise agreements for other companies. But it probably will never happen. Ex will eventually go to an all ISP operation for ground and express after the current ISP model is tested in court.

 

[Fred's Myth]

I still believe that the ISP model can be overcome by the right lawsuits. But it will take years and if successful could undo many franchise agreements for other companies. But it probably will never happen. Ex will eventually go to an all ISP operation for ground and express after the current ISP model is tested in court.

EXACTLY! All they have to do is eliminate that pesky I(ndependent) from ISP, and everything will fall into place!

 

[bacha29]

I still believe that the ISP model can be overcome by the right lawsuits. But it will take years and if successful could undo many franchise agreements for other companies. But it probably will never happen. Ex will eventually go to an all ISP operation for ground and express after the current ISP model is tested in court.

In today's world if orange is the new black then what you can get away with is the new lawful. Nevertheless, I still say that exploding deficits combined with weak tax collection and compliance will compel Congress to finally restore IRS funding and pass legislation to curb the abuses regarding the use of so called "independent contractors" especially in cases where tasks are labor intensive but require little in the way complex or professional skills.

 

[59 Dano]

Because UPS is going broke?

No, because they aren't going to maintain the current margin on Ground packages if they leave the contractor model and take on the expense/risk that would come with doing what has been suggested here. Why would they give up good money to make not-quite-as-good money with more liability?

 

[59 Dano]

Simply eliminating having 2-3 or more drivers in each area could decrease costs. For the greatest % of packages, if delivery areas were 1/3 to 1/4 the size, drivers would be able to meet deadlines for pickup and delivery windows while avoiding long double backs. Eliminating the double terminals(ground and express) is further savings.

They save a few bucks by closing a few buildings. That wouldn't offset the expense of adding additional trucks that they are responsible for maintaining and insuring, or the the additional employees, or any of the other expenses and risks that no one here bothers to consider.

They've looked at this from every possible angle. If there was a way to do it that would make them more money, they'd be doing it that way. Guess what? There isn't.

 

[MAKAVELI]

They save a few bucks by closing a few buildings. That wouldn't offset the expense of adding additional trucks that they are responsible for maintaining and insuring, or the the additional employees, or any of the other expenses and risks that no one here bothers to consider.

They've looked at this from every possible angle. If there was a way to do it that would make them more money, they'd be doing it that way. Guess what? There isn't.

UPS should be going bankrupt any day now.

 

[Cactus]

They save a few bucks by closing a few buildings. That wouldn't offset the expense of adding additional trucks that they are responsible for maintaining and insuring, or the the additional employees, or any of the other expenses and risks that no one here bothers to consider.

They've looked at this from every possible angle. If there was a way to do it that would make them more money, they'd be doing it that way. Guess what? There isn't.

Well once again you seem to have ALL the answers.

Geez all these businesses out there that could make bigger killings if Dano was brought on board as an adviser.

 

[59 Dano]

UPS should be going bankrupt any day now.

I know you're trying to be clever, but what point are you trying to make?

 

[59 Dano]

Well once again you seem to have ALL the answers.

Geez all these businesses out there that could make bigger killings if Dano was brought on board as an adviser.

The fact that someone is smarter than you and better informed than you shouldn't be shocking. It's not like it's a high hurdle to clear.

 

[MAKAVELI]

I know you're trying to be clever, but what point are you trying to make?

Think about it real hard and you just might get it.