Changing of presidential guard to ripple Mid-South

Major impact from FedEx to the farm

By Bartholomew Sullivan (Contact), Memphis Commercial Appeal
Sunday, January 4, 2009
WASHINGTON -- An Obama administration is expected to make a big and immediate impact nationwide, with tangible changes occurring in Memphis as the new president takes over.
In three policy areas in particular -- worker classification, agricultural subsidies and infrastructure spending -- change is coming to Shelby County.

A.J. Wolfe/The Commercial Appeal files
If independent contractors are reclassified as employees, it could cost Memphis' biggest employer billions.

Workers' categories




For FedEx, the region's largest employer, an Obama presidency is likely to mean legislative or regulatory remedies to years of litigation over the status of what the company calls "independent contractors" and others call "employees." Change may also come in the kind of legal jurisdiction over future labor agreements.
While still considered a long shot for president, Barack Obama introduced the Independent Contractor Proper Classification Act in September 2007 -- one of his few legislative initiatives in the Senate.
The bill would have required employers to treat workers misclassified as independent contractors as employees for employment-tax purposes.
FedEx maintains its drivers are independent small-business entrepreneurs who can set their own hours and hire assistants. A class-action lawsuit involving the status of drivers in 20 states is pending in Indiana.
If some FedEx contractors are ultimately deemed employees, according to an analysis by Bloomberg News, it might open the company to $2.5 billion in unpaid payroll taxes. The Teamsters Union, which would like to organize FedEx drivers like it has competitor UPS, estimated the change from contractor to employee status would cost FedEx $426 million more a year.
Meanwhile, House Transportation Committee chairman James Oberstar is determined to make FedEx Express drivers subject to the National Labor Relations Act, permitting them to organize collective bargaining units at the local level. Oberstar introduced the proposed change as an amendment to the Federal Aviation Administration Reauthorization Act in late 2007.
A final bill for the president's signature never emerged, but the provision is expected to be reintroduced in another bill early this year.
In remarks to financial analysts on Dec. 18, FedEx CEO Frederick W. Smith said bluntly that he hoped Oberstar's provision "would not see the light of day." He added that, if it does, he hoped that it would be the subject of congressional hearings.
"Obviously, the unions have the right to try to organize our folks and it's their right to decide on that if that's what they want," he said. "But we think that our form of success has been pretty good for the past 35 years."
Since the company's inception, FedEx employees have been subject to the jurisdiction of the Railway Labor Act, which governs air and rail collective bargaining agreements nationally. The company maintains that it operates an integrated air and delivery service and its entire international operation could be affected by a labor dispute at a single local bargaining unit.
Michael C. Harper, a labor law expert at the Boston University School of Law, said an Obama Labor Department is more likely to find that FedEx drivers are employees under the terms of the Fair Labor Standards Act and he said the Treasury Department is more likely to find them employees for payroll tax purposes.
"The likelihood of their being successful in continuing to be able to treat these drivers as independent contractors under these various laws is lower because Obama was elected," Harper said.

 

I guess when it rains it pours huh?

 

Seems to me that FedEx has been fighting this employee vs independent contractor issue for quite some time, well before Obama's climb to national acclaim. The next article from Mr. Bartholomew Sullivan will undoubtedly deal with the fact that the president-elect might actually side with labor, something that's not happened in a long time.

JJ

 

somebody has to pay labor
no profit no pay, how about a bailout

 

The elusive profits will certainly be diminished if we get taxed into the redistribution of wealth/financial stimulus program. Or whatever name it takes on.

My take on this article was somewhat selfish. The pilot group is going to feel this, (how can't say for sure, but paywise I imagine) in our labor group.

Sure, the teamsters want in here at Fedex. My brother is a teamster at UPS, not too impressed with thier performance. Also not sure that the majority of drives here at Fedex want this employee status or teamster takeover, at least the few I've talked to. But, I'm certainly no expert on unions...I'm barely figuring our contract out on a daily basis.

 

As a member of Teamsters at my airline I can only say this:

"JUST SAY NO!!!"

Nothing good has come from it

 

This is not about airline pilots and the Teamsters as their representative. It's about the FedEx ground personnel and their representation. Personally I don't like the teamsters, but they certainly have their place and have done a good job with the folks at UPS. It will be a long road to representation for the other work groups at FedEx, and if it ends up being the Teamsters, than that's fine with me. The original union at UPS was the teamsters, and like you, nothing good became of it, which is why the pilots of UPS are now represented by their own in-house union, The IPA.

JJ

 

THEN that's fine with me. Sorry.

 

Then I'm sorry that I used than when I should have used then. Maybe I'm getting Mad Cow disease.

JJ