From the Associated Press on Thursday:
“The Massachusetts attorney general says FedEx Ground has agreed to pay the state $3 million in a dispute over alleged misclassification of drivers as independent contractors. The state says the package delivery company’s actions denied the state payroll taxes as well as worker’s compensation and unemployment assistance contributions.
“The attorney general said the company also gained an unfair competitive advantage.”
This settlement comes after similar complaints in California were upheld by the courts and indicates that using and abusing federal labor laws to gain an “unfair competitive advantage” over its industry rivals by misclassifying its drivers may actually be part of FedEx’s overall corporate culture, if not its stated policy.
Indeed, on another front FedEx is attempting to retain another “unfair competitive advantage” by holding up the FAA reauthorization bill because of a provision eliminating a corporate welfare loophole in the law which allows FedEx Express, and ONLY FedEx Express, to misclassify its delivery drivers under the Railway Labor Act (RLA) as airline pilots.
What’s next, misclassifying them as independent contractor airline pilots?
The bigger problem with FedEx’s abuse of labor laws is that it invites further government meddling and regulation that will only hurt companies who aren’t pushing the envelope, so to speak, the way FedEx regularly does. When a big corporation like FedEx goes “rogue” like this, it ultimately can hurt all companies, even those not in the same industry.
It’s not only time for Congress to tell FedEx that it has to play by the same rules as everyone else, but that it won’t be threatened or intimidated into allowing the “FedEx Loophole” to continue holding up the FAA bill.
The Senate should send a shot across FedEx’s bow and kill two birds with one stone by passing the FAA Reauthorization Act with the field-leveling RLA provision intact.