By Alyson Palmer, From Daily Report

It’s unclear whether FedEx drivers are employees of the company, a federal appeals court panel ruled on Thursday.

The question is key to resolving a group of Florida drivers’ claims, one of several cases nationally in which FedEx drivers are seeking reimbursement of business expenses. Reversing a lower court judge’s ruling for FedEx that had said the drivers were independent contractors, the panel of the U.S. Court of Appeals for the Eleventh Circuit said factors weighing on both sides of the argument meant the question of employee status was one for a jury.

“If asked, a good number of [FedEx] customers would probably say that they believe (or reasonably assume) that the drivers of those white trucks are employed by FedEx,” wrote Judge Adalberto Jordan for the panel. “The law, however, sometimes has a funny way of making hard what would otherwise seem intuitively simple, and that is the case with the legal status of FedEx’s drivers.”

The Florida drivers filed suit against FedEx Ground Package Systems in 2005, asserting claims under Florida’s Deceptive and Unfair Trade Practices Act and common law claims such as breach of contract and fraud. For one thing, the drivers are seeking recoupment of a fee they paid to obtain items such as uniforms and scanners used to track packages.

Between 2003 and 2009, drivers in about 40 other states filed similar actions against FedEx. The cases were consolidated and transferred to the Northern District of Indiana by the Judicial Panel on Multidistrict Litigation. Many of those actions are now on appeal before the Seventh Circuit.

U.S. District Judge Robert Miller Jr. of the Northern District of Indiana granted the Florida drivers’ motion to certify the case as a class action, certifying a class of about 1,600 drivers who drove full-time for FedEx Ground or FedEx Home Delivery between 2000 and 2007. But he then granted FedEx’s motion for summary judgment, agreeing with FedEx that the drivers were merely independent contractors, not FedEx employees.

Miller then sent the case back to the Middle District of Florida, where U.S. District Judge Susan Bucklew granted summary judgment to FedEx on some individual drivers’ claims. The drivers appealed those rulings to the Eleventh Circuit.

There, joined by Chief Judge Ed Carnes and Judge Robin Rosenbaum, Jordan noted that the Florida drivers’ claims would stand or fall on whether FedEx properly classified them as independent contractors. The standard contract that FedEx drivers sign says that they are providing services “strictly as … independent contractor[s].” Under Florida law, wrote Jordan, that agreement helps FedEx’s argument, but the drivers may still be deemed employees if other provisions of the agreement or the parties’ actual practice demonstrate that the company’s independent contractor designation is not valid.

Several factors support FedEx’s position, said Jordan. For instance, he noted the company pays drivers based in part on the number of packages and stops in a driver’s service area and does not withhold for taxes or health insurance. Drivers can sell part or all of their service area to other drivers with notice to FedEx and are responsible for all costs associated with the purchase, lease and maintenance of their trucks.

But other factors undermine FedEx’s position, said Jordan. He said the driver contract and standard practices provided “an exhaustive and detailed list of procedures” that FedEx drivers are to follow in handling their work. A driver’s choice of truck is subject to FedEx’s determination that the vehicle is suitable and subject to specific requirements as to height, length, bumper height and cargo box size, he noted. Certain bonuses are dependent on usage of a scanner for all pickups. Drivers must prepare daily logs and are even instructed by FedEx how they should load a van—beginning with the last package to be delivered, Jordan wrote.

While reversing the grant of summary judgment to FedEx on the overall question of whether the Florida drivers are employees or independent contractors, the court upheld Bucklew’s grants of summary judgment to two drivers on their individual claims.

Matthew Houston of Harwood Feffer in New York, who argued the appeal for the drivers, said the Eleventh Circuit’s decision sends the case back to the Middle District of Florida for further pre-trial proceedings. “We’re very pleased with the decision,” Houston said, “because it makes clear that employment status under Florida law is not just a matter of self-serving labels. So we think this is a great result.”

Barry Richard of Greenberg Traurig’s Tallahassee office, who argued at the Eleventh Circuit for FedEx, could not be reached for comment.

The case is Carlson v. FedEx Ground Package Systems, No. 13-14979.

IMAGE: Jason Doiy

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