It is the free market. Whatever FedEx is paying the employees per hour is enough, because supply of employees exceeds demand.
It is called capitalism. If employees dry up, then Fedex (anyone) has to raise the starting wage to attract employees. Supply & demand. What built America.
Unless you like socialism, which worked so well in the Eastern Bloc, Soviet Union, Bethlehem Steel, Eastern Airlines, and UPS.
I absolutely agree with you about the free market system. People should get paid what the market will bear which includes their perception of quality and value.
Its not a perfect system, but it has proven superior to the other ideologies.
On the other hand, our system also expects that laws and regulations will be followed. Just because their is demand, one cannot shortcut the system.
For instance, Food and Drug laws must be followed. Regulations regarding environmental impacts must be adhered to. And there are also laws regarding employee classifications.
Different than the RLA issue where FedEx is properly following a bad law, many believe that they are violating an existing regulation by mis-classifying employees as independent contractors.
Below is some information on employees vs. contractors.
To me, a FedEx ground driver looks like an employee.
P-Man
The IRS says that the determinaiton is made based on the following factors of control:
Behavioral: Does the company control or have the right to control what the worker does and how the worker does his or her job?
Financial: Are the business aspects of the worker’s job controlled by the payer? (these include things like how worker is paid, whether expenses are reimbursed, who provides tools/supplies, etc.)
Type of Relationship: Are there written contracts or employee type benefits (i.e. pension plan, insurance, vacation pay, etc.)? Will the relationship continue and is the work performed a key aspect of the business?
Factors that allow one to be an independent contractor are:
If the worker supplies his or her own equipment, materials and tools
If all necessary materials are not supplied by the employer
If the worker can be discharged at anytime and can choose whether or not to come to work without fear of losing employment
If the worker control the hours of employment thus indicating they are acting as an independent contractor
Whether the work is temporary or permanent
Outside of the Fair Labor Standards Act, courts ask the following questions to determine work relationship in addition to both an economic and an agency test:
- What is the degree of control over work and who exercises that control?
- What is each party's level of loss in the relationship?
- Who has paid for materials, supplies and/or equipment?
- What type of skill is required for work?
- Is there a degree of permanence?
- Is the worker an integral part of the business?
