Six Point Test

[It will be fine]

Why do you think that?

I read the complaint. The contractor had a bad run but I don’t see anything that lets her get past the arbitration clause. It reads like someone that just got in over their head and didn’t know how to make it work. The risk of financial failure is a key aspect of contracting as opposed to employment. FedEx hasn’t claimed, let alone promised any contractor will make money for a long time now.

 

[MAKAVELI]

I read the complaint. The contractor had a bad run but I don’t see anything that lets her get past the arbitration clause. It reads like someone that just got in over their head and didn’t know how to make it work. The risk of financial failure is a key aspect of contracting as opposed to employment. FedEx hasn’t claimed, let alone promised any contractor will make money for a long time now.

Arbitration doesn't apply in a federal case. That's why this one is different than the others.

 

[It will be fine]

Arbitration doesn't apply in a federal case. That's why this one is different than the others.

Most of her complaint could have been dealt with through arbitration while she was a contractor. She didn’t attempt that avenue of relief that she agreed to. I don’t think the RICO stuff has legs. It looks like a Hail Mary to me. I expect it to get tossed.

 

[MAKAVELI]

Most of her complaint could have been dealt with through arbitration while she was a contractor. She didn’t attempt that avenue of relief that she agreed to. I don’t think the RICO stuff has legs. It looks like a Hail Mary to me. I expect it to get tossed.

Doesn't matter. Arbitration doesn't apply in a federal case. She knew it would be waste of time to go to arbitration.

 

[What'dyabringmetoday???]

Looking at the U.S. Department of Labor final rule including the six point test used to determine worker classification it would appear that Fat Freddy and Raj is going to have to come up with the mother of all bull feces stories in order to keep their little "contractor" game going.

There are several web sites and U Tube videos that have been posted by law firms and HR consulting firms that explains those new rules in everyday terms and applications including the fact that Fat Freddy needs only to fail one of the six tests rather than all of them in order to see his little house of straw getting blown away by a cyclone of law suits.

It would appear that in the coming days Fat Freddy in order to keep his little scam up and running it will require quite a bit in the way of lessening the strict rules and constraints especially in the way of equipment, appearance standards ,transfer of ownership restrictions and operating exclusively under Fat Freddy's DOT authority.

Will it result in another barrage of class action law suits? Perhaps. I would be thinking more along the lines of leaving it up to the DOJ to serve Fat Freddy a generous helping of humble pie.

Will he be able to successfully defend his so called "independent contractor" model? Perhaps. At the same time however based on the new test it would appear that it won't be as easy as it was in the past. If you recall that under the terms of the out of court settlement of the multi state class action Fat Freddy got away without having to admit any fault of wrong doing.

Might not be as simple, cheap and easy this time around.

I hope FedEx goes out of business. No offense to you of course...

 

[bacha29]

Doesn't matter. Arbitration doesn't apply in a federal case. She knew it would be waste of time to go to arbitration.

If she can get it into the federal courts then we're off to the races. This approach to my knowledge has never been attempted before so you can't rule anything out.

 

[bbsam]

I read the complaint. The contractor had a bad run but I don’t see anything that lets her get past the arbitration clause. It reads like someone that just got in over their head and didn’t know how to make it work. The risk of financial failure is a key aspect of contracting as opposed to employment. FedEx hasn’t claimed, let alone promised any contractor will make money for a long time now.

When I first read the complaint I too was skeptical. But there is a difference between a “risk of financial failure” and a company contractors up to fail for their own enrichment.

Consider an initial contract. The new contractor has done due diligence, has a good business plan, and the numbers make sense. Contractor takes out a multi year loan for $ 1 million plus and begins the day to day business activities.

A year later at negotiations 3 MESOs pop up all considerably lower than the previous year. Following year as labor and inflation continued to hammer the economy and FedEx turns a nice profit, they hit their customers with fuel surcharges that never go to the contractor.

Yes. We’ve all seen it. They’ve got people stuck with few choices. AND IT IS ALL ENGINEERED THAT WAY. It’s a “take it or leave it” negotiation. If you decide to leave it, they’ll sweeten the pot for the next Facebook sourced candidate. Because it’s not about finding knowledgeable and experienced contractors. It’s about bleeding the next soccer dry and driving up the stock price.

I’m not an attorney, but an accomplished one could make a compelling case for all of the above facts. And to be quite honest, if FedEx would be interested in fighting that and would be open to showing how they calculate CSA values, I would be quite interested. But they won’t do that.

This case has gotten judicial and political attention. This isn’t like every other time FedEx has been sued. People (thanks to Donald Trump and the rest of the Republican crime family ) have people somewhat tuned into what a RICO case means. I doubt that an arbitration clause in a contract that could at least be found unconscionable has the power to derail the complaint.

 

[It will be fine]

When I first read the complaint I too was skeptical. But there is a difference between a “risk of financial failure” and a company contractors up to fail for their own enrichment.

Consider an initial contract. The new contractor has done due diligence, has a good business plan, and the numbers make sense. Contractor takes out a multi year loan for $ 1 million plus and begins the day to day business activities.

A year later at negotiations 3 MESOs pop up all considerably lower than the previous year. Following year as labor and inflation continued to hammer the economy and FedEx turns a nice profit, they hit their customers with fuel surcharges that never go to the contractor.

Yes. We’ve all seen it. They’ve got people stuck with few choices. AND IT IS ALL ENGINEERED THAT WAY. It’s a “take it or leave it” negotiation. If you decide to leave it, they’ll sweeten the pot for the next Facebook sourced candidate. Because it’s not about finding knowledgeable and experienced contractors. It’s about bleeding the next soccer dry and driving up the stock price.

I’m not an attorney, but an accomplished one could make a compelling case for all of the above facts. And to be quite honest, if FedEx would be interested in fighting that and would be open to showing how they calculate CSA values, I would be quite interested. But they won’t do that.

This case has gotten judicial and political attention. This isn’t like every other time FedEx has been sued. People (thanks to Donald Trump and the rest of the Republican crime family ) have people somewhat tuned into what a RICO case means. I doubt that an arbitration clause in a contract that could at least be found unconscionable has the power to derail the complaint.

FedEx doesn’t set the prices on the routes. Someone taking out massive debt to buy a route isn’t a FedEx problem where the issues caused by that debt are FedEx’s responsibility. FedEx gives the routes away for free. I think it’s a heavy lift to prove FedEx wants their contractors to fail. Successful delivery of packages is kinda important to FedEx.

All the facts can be as the complaint reads and I still think it will be hard to get the arbitration clause tossed.

 

[MAKAVELI]

FedEx doesn’t set the prices on the routes. Someone taking out massive debt to buy a route isn’t a FedEx problem where the issues caused by that debt are FedEx’s responsibility. FedEx gives the routes away for free. I think it’s a heavy lift to prove FedEx wants their contractors to fail. Successful delivery of packages is kinda important to FedEx.

All the facts can be as the complaint reads and I still think it will be hard to get the arbitration clause tossed.

Again, the clause doesn't apply in a federal case.

 

[It will be fine]

Again, the clause doesn't apply in a federal case.

I expect the RICO claims to be dismissed in a pretrial motion in part because she had a remedy available in the arbitration clause of the contract she signed.

 

[MAKAVELI]

I expect the RICO claims to be dismissed in a pretrial motion in part because she had a remedy available in the arbitration clause of the contract she signed.

Her case is in a labor friendly jurisdiction. I'd say she has a good chance of her lawsuit moving forward.

 

[bacha29]

Her case is in a labor friendly jurisdiction. I'd say she has a good chance of her lawsuit moving forward.

I think that she would have very little trouble lining up a courtroom full of former contractors who have experienced pretty much the same thing. I think the system itself is getting of having FDX tying up valuable court time and resources defending a business model that is slowly becoming too cumbersome and expensive to defend.

 

[It will be fine]

Her case is in a labor friendly jurisdiction. I'd say she has a good chance of her lawsuit moving forward.

Maybe. Venue doesn’t change the underlying issues though. FedEx doesn’t benefit from a contractor failing. She had too much debt, she didn’t handle the road closure in her service area well, her service tanked and FedEx chose someone else to deliver their packages after her contract expired. Her big loss is her purchase debt that has nothing to do with FedEx. It’s run of the mill start up business failure.

 

[MAKAVELI]

Maybe. Venue doesn’t change the underlying issues though. FedEx doesn’t benefit from a contractor failing. She had too much debt, she didn’t handle the road closure in her service area well, her service tanked and FedEx chose someone else to deliver their packages after her contract expired. Her big loss is her purchase debt that has nothing to do with FedEx. It’s run of the mill start up business failure.

I'm sure you hope that's the case. If she's successful, your " business"will be worth $0.

 

[SmithBarney]

Honestly I think the merger is just supposed to buy some time from the inevitable shut down of the company.

Merger may allow FedEx to "take over" cancelled ground contracts, and hire existing ground drivers as lower wage(lower than express) employees..

 

[SmithBarney]

Maybe. Venue doesn’t change the underlying issues though. FedEx doesn’t benefit from a contractor failing. She had too much debt, she didn’t handle the road closure in her service area well, her service tanked and FedEx chose someone else to deliver their packages after her contract expired. Her big loss is her purchase debt that has nothing to do with FedEx. It’s run of the mill start up business failure.

And Fedex will "offer" pennies on the dollar to buy the route back from failed contractor, basically just buying the truck. Fedex will then offer the ground driver a "job"