ISP contract with the Company.....

Discussion in 'FedEx Discussions' started by DontThrowPackages, Oct 13, 2012.

  1. DontThrowPackages

    DontThrowPackages Well-Known Member

    Curious how does the whole ISP thing work. A guy buys a route from Fedex, then buys trucks, tools, fuel, mechanics, uniforms, hires drivers and they all meet inside a building that's leased by Fedex with the Fedex name all over it, to deliver packages it gets from Fedex. They all follow the rules Fedex lays down and they make business. My question is, how long is the contract the ISP signs with Fedex? Is it 5 or 10 years. What assurance does an ISPer have if the company, after being sued time and time again over this business model they've created, decides to ask those drivers to one day become employees at the same pay and all? Will Fedex buy the trucks off of the ISP and give him/her a nice payout? When it comes down to it, its the companies packages and buildings what will they do for the ISPer? A lot of Express trucks are being replaced by vans day by day. I'm curious to know what the company is doing with those trucks? are they storing them away for a day when they decide to hire bunch of guys away from the ISPer?
    I would hope the ISP at least get a 20 year contract because being left high and dry with a bunch of tools no longer need, might make some wonder if its worth the risk. Maybe the ISPers are doing so well that its doesn't matter. Maybe they've already made enough to retire on from the ground game. At least someone did well.
     
  2. vantexan

    vantexan Well-Known Member

    If FedEx cut out the middle man the new employees would be eligible to unionize. They aren't air cargo employees under the RLA. Pretty unlikely FedEx will ever get rid of the ISP model as long as the courts allow it.
     
  3. MrFedEx

    MrFedEx Engorged Member

    Sounds like FedEx has almost complete control over the operation, doesn't it?
     
  4. bbsam

    bbsam Moderator Staff Member

    Of course he admits that he really doesn't know how things work at Ground, as have you, so we really can't formulate that conclusion now can we?
     
  5. Nick9075

    Nick9075 Member

    Contract is just for one year. They don't have to renew you. I plan to sell my routes after the new year. So far I am barely breaking even with my gross from three routes over 7000 a week. I owe close to $2000 in state and federal taxes plus personal taxes that I can't afford to pay.
     
  6. bbsam

    bbsam Moderator Staff Member

    My ISP contract is for 5 years.
     
  7. MrFedEx

    MrFedEx Engorged Member


    I think FedEx exerts far more control over Ground operations than you are willing to admit. We'll agree to disagree as usual on that.
    On another note, maybe you have been given an opportunity to buy former Express W700's lately? We're all wondering where they are going, so perhaps you have an inside track on this. Usually, Express scraps everything they retire from the fleet, but some of the 700's are relatively new, and I don't see them getting crushed.

    So, had any offers from corporate lately on "good, used trucks"?
     
  8. bbsam

    bbsam Moderator Staff Member

    The 700's are all over Ebay. I'm not a fan. Rather have Ford 5.4L Tritons in that size truck.
     
  9. bbsam

    bbsam Moderator Staff Member

    Courts have found Ground to exert too much control and Ground has tweaked their model to fit the law. No reason to believe they wouldn't follow the same strategy going forward. They can always adapt to the letter of the law. Simply put, courts would have to find contracting illegal across the industry to end Ground's reliance on contractors.
     
  10. UpstateNYUPSer

    UpstateNYUPSer Very proud grandfather.

    I think even you would agree that the relationship between FedEx and their IC's blurs the line between employer/contractor and employer/employee.
     
  11. bbsam

    bbsam Moderator Staff Member

    Honestly, that depends. There are indeed managers that ignore the contract and intimidate contractors. That has never stood at our terminal. We have always had entrepenurial folks as contractors. As for the blurry line, Fedex doesn't blur that line, that line is and has been blurry since the inception of contracting. The language and criteria have always been subject to interpretation by courts when ICs have been utilized. It is very much the nature of the beast.
     
  12. UpstateNYUPSer

    UpstateNYUPSer Very proud grandfather.

    Your employees are expected to wear the company uniform, comply with company directives and represent the company 12 hours a day. When I walk in to a business stop the consignee doesn't say, "Oh, the Independent Contractor's employee was just here"--they say "the FedEx Ground driver was just here". Anyone who does not consider FedEx Ground drivers to be employees of the company needs to schedule an eye exam.
     
  13. bbsam

    bbsam Moderator Staff Member

    And that's how Fedex wants it. That doesn't mean, however, that Ground falls outside the scope of a very loosely and ill defined set of criteria. In fact, not all the criteria have to be fully met to be considered ICs. Why doesn't the government clarify exactly? I have no idea.
     
  14. MrFedEx

    MrFedEx Engorged Member

    Yep.
     
  15. bbsam

    bbsam Moderator Staff Member

    MFE. Would you like to tell why the IC law lacks definition and is susceptible to widely varying legal interpretation?
     
  16. bbsam

    bbsam Moderator Staff Member

    Might be good for R1a to jump in as well if he's still around.
     
  17. MrFedEx

    MrFedEx Engorged Member

    I'm no lawyer, but I play one here. IMO, it's not IC law that will undo Ground, it's the definition of "independent contractor" that will sink Uncle Fred. Look it up, and see what you think, but this humble poster thinks that FedEx legally exceeds the limitations of that definition. In other words, Ground drivers are really employees.
     
  18. DorkHead

    DorkHead Active Member

    bbsam would you consider yourself or your drivers employees of fedex when you deliver fedex air pkgs? Isn`t air freight supposed to be delivered by express drivers? It seems to me once you start delivering any air pkg, then fedex has violated the RLA rules. I honestly don`t know and figure you most likely do.
     
  19. Of course we're really employees. I'm employeed by so and so, LLC.
     
  20. vantexan

    vantexan Well-Known Member

    He's still trying to figure out how his inside sources with company documents mislead him about the restructuring.