Business Model for Ground Operations in
"FedEx has exposed investors to exorbitant legal and tax liabilities by
misclassifying drivers as independent contractors across the country for years,"
said Teamsters General President
According to company documents,
The company claims that these contractors will not be required to use FedEx-approved drivers, trucks, scanners, or uniforms; they will be individually responsible for managing all of the logistics of their service areas including meeting the complex demands of seasonal volume fluctuations; and they will have the right to refuse pick-ups and deliveries under certain circumstances.
If implemented as proposed, the FedEx New Hampshire plan is similar to the
chaotic Independent Cartage Carriers (ICC) model DHL Express used for half of
its U.S. network. That model, which DHL inherited from Airborne Express, relied
on more than 600 different ICC's (employing approximately 12,000 drivers) at a
given time. The tight margins dictated by this type of relationship made for
high turnover among the ICC's as well as the drivers. This past fall DHL Express
announced it was leaving the domestic US market after sustaining losses of
"FedEx investors cannot afford to gamble on another scheme that will either add to the company's legal and regulatory problems or undermine customer service in this competitive industry," Hoffa said.
The International Brotherhood of Teamsters was founded in 1903 and represents
more than 1.4 million hardworking men and women throughout