Owning and Operating a FedEx Ground ISP

contractor wife

New Member
Advice
Use a certified payroll company. Overtime mistakes can cost you your contract.
IE: You pay a driver 15/hr. x 2080 hrs = 31200/yr. You would think that OT pay would be 15 x 1.5 or 22.50/hr.

However if you have been paying out regular safety and/or service bonuses to your employees you MUST figure that compensation into the hourly wage:

Example: Your employees regularly earn an average of 200/month in safety bonus. They don't always get it, but for 10 months they do. You must consider the additional 2000.00 in their hourly pay. 31200 +2000 = $33200/2080 = 15.96/hr

Overtime MUST be paid at 15.96 x 1.5 or 23.94/hr. If you fail to do this then your are in violation of your contractual obligations as a FedEx ISP contractor.

Few ISP providers that do their own payroll will figure OT correctly if they are paying regular bonuses. BE CAREFUL and use a certified payroll company.
 

bbsam

Moderator
Staff member
Advice
Use a certified payroll company. Overtime mistakes can cost you your contract.
IE: You pay a driver 15/hr. x 2080 hrs = 31200/yr. You would think that OT pay would be 15 x 1.5 or 22.50/hr.

However if you have been paying out regular safety and/or service bonuses to your employees you MUST figure that compensation into the hourly wage:

Example: Your employees regularly earn an average of 200/month in safety bonus. They don't always get it, but for 10 months they do. You must consider the additional 2000.00 in their hourly pay. 31200 +2000 = $33200/2080 = 15.96/hr

Overtime MUST be paid at 15.96 x 1.5 or 23.94/hr. If you fail to do this then your are in violation of your contractual obligations as a FedEx ISP contractor.

Few ISP providers that do their own payroll will figure OT correctly if they are paying regular bonuses. BE CAREFUL and use a certified payroll company.
Is that state by state? Most contractors I know pay daily and not hourly so maybe they escape that scrutiny.
 

dmac1

Well-Known Member
If you pay a daily rate and the normal day is 8 hours, you better make sure your state doesn't equate that with an hourly rate. You are better off in most cases from a legal standpoint by paying an hourly rate, plus bonuses.Something like maintaining a high enough SPH earning a bonus could help avoid owing OT. If you fire your driver, or he/she is disqualified, having a disgruntled employee could cost you a lot more if they go to see an attorney.
 

Fred's Myth

Nonhyphenated American
If the truck they drive is over 10k lbs they are covered by the motor carrier exemption and overtime pay is not required. That's federal.

The following jobs require payment of overtime, but workers may be paid on an alternative overtime payment method:
  • Truck or bus drivers whose company has a “reasonably equivalent” overtime compensation plan approved by the Department of Labor & Industries.
 

It will be fine

Well-Known Member
The following jobs require payment of overtime, but workers may be paid on an alternative overtime payment method:
  • Truck or bus drivers whose company has a “reasonably equivalent” overtime compensation plan approved by the Department of Labor & Industries.
I've been sued for it and won, but post whatever you want to.
 

bacha29

Well-Known Member
If the truck they drive is over 10k lbs they are covered by the motor carrier exemption and overtime pay is not required. That's federal.
That's correct. The focus of the ruling involves CDL long haul who are payed by the mile. Nothing on the horizon yet regarding using 10K plus units doing local P&D but given the growing dependency by low wage employed individuals on social programs to subsidize their low incomes and with massive federal funding cuts to these programs expected leaving states to find ways to make up the shortfall you might see states taking action regarding these practices in an attempt to reduce the number of people receiving benefits.
With many states in dire financial straights with the worst yet to come don't rule out a consolidated multi state lawsuit being filed in federal court sometime in the not too distant future.
 

It will be fine

Well-Known Member
That's correct. The focus of the ruling involves CDL long haul who are payed by the mile. Nothing on the horizon yet regarding using 10K plus units doing local P&D but given the growing dependency by low wage employed individuals on social programs to subsidize their low incomes and with massive federal funding cuts to these programs expected leaving states to find ways to make up the shortfall you might see states taking action regarding these practices in an attempt to reduce the number of people receiving benefits.
With many states in dire financial straights with the worst yet to come don't rule out a consolidated multi state lawsuit being filed in federal court sometime in the not too distant future.
Nothing will change as long as the DOT determines work hours for the drivers and sets their wages by minimum wage.
 
Top