FedEx Home wins round in Unionization efforts

[Livin the Dream?]

I'm sure Fred is looking at ways to give you more Express business. The multiple-route IC is the new plan that the Corporation is trying to use to justify the IC model. Is that exact enough for you? If other states accept it as legal, that's what FedEx will try there as well.

Speaking of which, how is the research going? You find the legal definition yet?

 

[LED]

Maybe one day people will ask: What is an independent contractor?

A bolstered Democratic majority and the incoming Obama administration might be poised to rewrite a 30-year-old law critics say lets companies skirt billions of dollars in taxes, while depriving workers of benefits like overtime pay, family and medical leave and the right to join a union.
President-elect Obama introduced a bill last fall to crack down on companies' ability to classify workers as independent contractors rather than employees. The IRS for years has tried to claw back revenues from companies they say have "misclassified" workers as contractors, which can save employers up to 30 percent on payroll taxes. Estimates of federal revenue loss attributed to worker misclassification have ranged as high as $4.7 billion a year.
The Obama bill would amend the 1978 law that protects the tax status of companies employing independent contractors by removing an exemption for firms that designate workers as such based on long-standing practice in that industry. Critics argue that standard is too easy to meet, and a Joint Committee on Taxation report last year said the law is "construed liberally in favor of taxpayers."
The bill also would enable the IRS to determine if workers should be "reclassified" as employees; allow the agency to write regulations on how workers should be classified, and require companies to notify contractors of their right to seek a determination of whether they should be designated employees.
"Every day, millions of Americans go to work and play by the rules, teaching our children the values of hard work and responsibility," Obama said in a statement when the bill was introduced. "And most employers treat their workers fairly, paying them a decent wage and providing the benefits they deserve. But we must fix the system to stop those few employers from breaking the rules and exploiting this tax loophole at the expense of taxpayers and our workers' safety and security."
Transportation, construction and financial services firms like FedEx, D.R. Horton Inc. and Ameriprise Financial Inc. that rely heavily on contractors could take a hit, as would smaller companies in a range of industries and self-employed workers like travel agents, plumbers, nurses, bicycle couriers and freelance writers, critics say.
The bill would continue to exempt real estate agents and direct sellers of products like books and cosmetics, who are considered inherently contractors under current law.
Groups like the U.S. Chamber of Commerce and National Federation of Independent Business are leading the opposition, as are affected companies such as FedEx, which has already been sued in 20 states for its use of contract delivery drivers. FedEx employs roughly 15,000 drivers as contractors, who don't receive health, pension and other benefits and have to pay for their own trucks, but can set their own schedules and hire employees for their contracted FedEx delivery routes.
"We have always believed our independent contractors are not employees and legal review processes are addressing the fundamental question of whether it should be illegal to work for oneself. We say it should not," said FedEx spokesman Maury Lane. He said there were an estimated 10 million independent contractors across a wide range of industries, adding "these small business owners are the backbone of this country's economy and further unnecessary regulation will only lead to more nationwide economic dislocation."
Various union groups, including the Teamsters -- who have battled for years to organize FedEx drivers, as they have at rival UPS -- are urging Democrats to act early next year. "We definitely think it can happen in that kind of time frame," said AFL-CIO legislative representative Kelly Ross.
He said the existing law is prone to abuse, and the bill would only target companies that were unfairly taking advantage of a loophole. "It's really about enforcing current law, and trying to go after people who are cheating," Ross said.
Obama has powerful allies, including co-sponsors like Senate Majority Whip Dick Durbin, D-Ill., and Health, Education, Labor and Pensions Committee Chairman Edward Kennedy, D-Mass.
House Ways and Means Income Security Subcommittee Chairman Jim McDermott, D-Wash., and Select Revenue Measures Subcommittee Chairman Richard Neal, D-Mass., held a joint hearing on the subject in May 2007, and introduced similar legislation this year backed by House Education and Labor Chairman George Miller.
The House bill would go even further, levying an additional $10,000 fine per misclassified worker. With the economic downturn hurting workers' paychecks, McDermott said he would try to push the measure early next year, as one of the first orders of business after a stimulus package.
"In a time of a collapsing economy, the absence of healthcare benefits for many American workers and collapsing pension programs, this issue is even more important than it was before and it will be one of my top priorities in the next Congress," McDermott said.
However, Small Business Legislative Council President John Satagaj said the legislation could crush companies' ability to hire at all. "Right now, if you're a small business, you're looking at survival tactics," he said.

http://www.govexec.com/dailyfed/1108/112008cdam1.htm

 

[iowa boy]

Speaking of which, how is the research going? You find the legal definition yet?

Livin,

Isn't the true 'legal definition" of an IC determined by the IRS?

 

[Livin the Dream?]

Livin,

Isn't the true 'legal definition" of an IC determined by the IRS?

Correct.

 

[iowa boy]

Correct.

I would be real curious to know if FedEx actually filled out the form the IRS has to actually determine if their ground unit meets the definition of IC or common law employee?

 

[Livin the Dream?]

I would be real curious to know if FedEx actually filled out the form the IRS has to actually determine if their ground unit meets the definition of IC or common law employee?

I know the form. I would guess not - but they would not want to chance a poor result when they can make the determination based on their own judgment. Control of how the work is done (employee) vs control of the end result (IC) gets very, very muddy when in a service business. FedEx can claim that he entire process of delivering a package is the actual "end result", can therefore exert control over it, and have a valid IC model.

It is much easier to determine with a manufacturing type position.

 

[iowa boy]

I know the form. I would guess not - but they would not want to chance a poor result when they can make the determination based on their own judgment. Control of how the work is done (employee) vs control of the end result (IC) gets very, very muddy when in a service business. FedEx can claim that he entire process of delivering a package is the actual "end result", can therefore exert control over it, and have a valid IC model.

It is much easier to determine with a manufacturing type position.

I'm not gonna get into the control aspect of that as i believe the IRS should make the final determination of that.

Getting off on a tangent now, Isn't it funny how all the courts but one have ruled against this model, but yet the IRS has never chimed in to definitively say yes they are or no they are not IC's? Will the final edict for this come from the Supreme Court, or the IRS, who I believe should make the final determination.

 

[Livin the Dream?]

I'm not gonna get into the control aspect of that as i believe the IRS should make the final determination of that.

Getting off on a tangent now, Isn't it funny how all the courts but one have ruled against this model, but yet the IRS has never chimed in to definitively say yes they are or no they are not IC's? Will the final edict for this come from the Supreme Court, or the IRS, who I believe should make the final determination.

The supreme court. IRS made the guidelines, supreme court interprets it.

 

[trplnkl]

To my understanding, The first law suit brought against FedEx on their IC model, was by the IRS.

 

[iowa boy]

To my understanding, The first law suit brought against FedEx on their IC model, was by the IRS.

This I did not know

 

[705red]

No, it is happening because the Teamsters/UPS wants it to.

It is happening because Fed ex employees have asked for representation. Fed ex is hiding behind the independant contractor concept. How many ic's do you know that pay money to the company to work for it?

 

[MrFedEx]

I know the form. I would guess not - but they would not want to chance a poor result when they can make the determination based on their own judgment. Control of how the work is done (employee) vs control of the end result (IC) gets very, very muddy when in a service business. FedEx can claim that he entire process of delivering a package is the actual "end result", can therefore exert control over it, and have a valid IC model.

It is much easier to determine with a manufacturing type position.

Your law degree is from where? Oh, yes, the University of Nowhere...that's right. That's the place that advertises in the back of Popular Mechanics, isn't it? A FedEx Ground contractor or his driver is completely controlled by the FedEx heirarchy of rules and procedures, not unlike UPS. They have control over both how the work is done and control over the end result. Your $19.95 "education" provides $19.95 levels of wisdom.

 

[Livin the Dream?]

Your law degree is from where? Oh, yes, the University of Nowhere...that's right. That's the place that advertises in the back of Popular Mechanics, isn't it? A FedEx Ground contractor or his driver is completely controlled by the FedEx heirarchy of rules and procedures, not unlike UPS. They have control over both how the work is done and control over the end result. Your $19.95 "education" provides $19.95 levels of wisdom.

I'd love to discuss this rationally with you. I've enjoyed doing so with others on this thread. So please, feel free to do so when you have actually researched the subject you are arguing - my guess is you will be too embarrassed once you find out the facts.

And it was on the back cover of "Guns & Ammo"

 

[MrFedEx]

I've been completely rational. Your "facts" are nothing but your opinion. I actually work for FedEx and have been there quite awhile, so I do know the way the company operates and see the possibilities of what Fred might do with Ground, especially as it relates to Express. I'm guessing the Supreme Court will overturn the Appeals Court decision, which got through on pure politics.

If it's your opinion that they are IC's, so be it, but if the original model for "owner-operator's" is so sound, why is FedEx changing it? They micro-manage Ground people just like FedEx Express and UPS do with their "employees". A true independent contractor has much more leeway on how they conduct business.

Nowhere U has campuses in East Bicycle Seat, AR, Possum Flats, OK, and a main campus at Bum*****,MS....which one did you attend?

 

[Livin the Dream?]

I've been completely rational. Your "facts" are nothing but your opinion. I actually work for FedEx and have been there quite awhile, so I do know the way the company operates and see the possibilities of what Fred might do with Ground, especially as it relates to Express. I'm guessing the Supreme Court will overturn the Appeals Court decision, which got through on pure politics.

If it's your opinion that they are IC's, so be it, but if the original model for "owner-operator's" is so sound, why is FedEx changing it? They micro-manage Ground people just like FedEx Express and UPS do with their "employees". A true independent contractor has much more leeway on how they conduct business.

Nowhere U has campuses in East Bicycle Seat, AR, Possum Flats, OK, and a main campus at Bum*****,MS....which one did you attend?

Nowhere do you state that you understand what an independent contractor is by IRS definition. That is ALL THAT MATTERS.

I don't care if YOU work for FedEx, UPS, or the IRS - it does not mean you understand it either. It appears you do not.

You don't need a law degree to understand a simple written definition. It is the interpretation of that written definition that is up for debate.

Interesting that you are aware of all the campuses of Nowhere U. I will not insert joke at your expense here. You're welcome.

 

[MrFedEx]

Nowhere do you state that you understand what an independent contractor is by IRS definition. That is ALL THAT MATTERS.

I don't care if YOU work for FedEx, UPS, or the IRS - it does not mean you understand it either. It appears you do not.

You don't need a law degree to understand a simple written definition. It is the interpretation of that written definition that is up for debate.

Interesting that you are aware of all the campuses of Nowhere U. I will not insert joke at your expense here. You're welcome.

I graduated with honors from the Possum Flats campus. I'm thinking of going back to East Bicycle Seat for my Masters.If you understand being an IC so well, how come you didn't understand the independent contractor status of a real estate agent? FedEx has muddied the waters by the degree of control they exert over their "IC's", which is considerable. In my opinion (and many others), that extensive control over the manner in which IC's do their job makes them "employees".

Let's go back to a realtor, who works his or her own schedule, pays their own taxes quarterly, and generally performs their job duties without direct oversight. My broker doesn't monitor me every minute with a tracking device like FedEx does, nor does she require me to be any place at any particular time, like FedEx does. My duties meet the standards for being a true IC, unlike FedEx Ground. Can you see that there's a big difference there?

Just curious. Why wouldn't a UPS employee be in favor of the FedEx Ground advantage going away? A lot of IC's flat-rate their drivers and pay them a salary so they don't have any OT, or hire guys who can hardly speak English and will work for $10-$13 per hour with no benefits. How do you expect a legitimate company like UPS to compete with that kind of cost structure?

 

[JimJimmyJames]

If I may be so bold to explain, Livin the Dream?'s argument is that UPS should not concern itself with the internal operations of FedEx. And we certainly should not be trying to convince the government that what FedEx is doing is wrong.

Since he believes FedEx operates in a completely legal manner, in his opinion UPS needs to compete with FedEx solely on the merits of who provides the best service for the best price.

I personally think that FedEx Ground has cleverly used the legitimate "independent contractor" designation to label their personnel everything but what they actually are, employees.

I also think UPS cannot compete against FedEx if FedEx decides to use the IC model across the board, that is, if they turn the Express division employees into contractors. I will be the first to admit I cannot compete with people who make half of what I make no matter how hard I try.

 

[MrFedEx]

If I may be so bold to explain, Livin the Dream?'s argument is that UPS should not concern itself with the internal operations of FedEx. And we certainly should not be trying to convince the government that what FedEx is doing is wrong.

Since he believes FedEx operates in a completely legal manner, in his opinion UPS needs to compete with FedEx solely on the merits of who provides the best service for the best price.

I personally think that FedEx Ground has cleverly used the legitimate "independent contractor" designation to label their personnel everything but what they actually are, employees.

I also think UPS cannot compete against FedEx if FedEx decides to use the IC model across the board, that is, if they turn the Express division employees into contractors. I will be the first to admit I cannot compete with people who make half of what I make no matter how hard I try.

The problem is that FedEx does not operate in a completely legal manner. That's my opinion, but it's shared by many others at all divisions of FedEx. They skirt and flaunt the law in so many ways and have done so for a long time. That's Express, Ground, Home, Freight, and all of their other divisions too.

Smith has spent hundreds of millions of dollars for 36 years keeping his exemption, and UPS has made token efforts to level the playing field...until now. With a pro-labor administration in place, now is the time to spend the money and lobby for the end of the exemption and competitive equality. It's unfortunate that our political system works this way, but it does. Fred has some high-profile ex-politicians working for him and has quite a few big name Republicans in his pocket too.

If you want competition based on the merits of the best service at the best price, the playing field must be leveled. IMO, UPS has better ground service, and NDA is about the same. But how is it fair that FedEx gets to have a cost structure that in effect subsidizes both it's Express and Ground rates? The RLA exemption and the old IC model are both prime examples of political privilege granted to someone with enough money to manipulate the system in his favor. That's not right, it's not ethical, and it isn't fair.

 

[Livin the Dream?]

...If you understand being an IC so well, how come you didn't understand the independent contractor status of a real estate agent? ...

Didn't understand it? LOL - Because it is not one! It was such a bad example I was hoping someone else would chime in. I was disappointed. RE Brokers & salespeople are under a Broker / Licensee agreement, State-mandated relationship. It is truly an apples to bullfrogs comparison.

If you are either a RE Broker or licensee placing his shingle in the office of same, you already know this.

 

[Livin the Dream?]

If I may be so bold to explain, Livin the Dream?'s argument is that UPS should not concern itself with the internal operations of FedEx. And we certainly should not be trying to convince the government that what FedEx is doing is wrong.

Since he believes FedEx operates in a completely legal manner, in his opinion UPS needs to compete with FedEx solely on the merits of who provides the best service for the best price.

I personally think that FedEx Ground has cleverly used the legitimate "independent contractor" designation to label their personnel everything but what they actually are, employees.

I also think UPS cannot compete against FedEx if FedEx decides to use the IC model across the board, that is, if they turn the Express division employees into contractors. I will be the first to admit I cannot compete with people who make half of what I make no matter how hard I try.

Feel free to speak on my behalf any time you wish - because you are dead-on.