FedEx Settles California Wage Lawsuit for $228M

FedEx agreed to pay $228 million to settle an employee misclassification lawsuit claiming the company short-changed drivers on pay and benefits by improperly labeling them as independent contractors.

The FedEx California wage settlement is directly related to a decision against the parcel delivery giant in August, when a federal appeals court in Oakland, California found that FedEx Corp. misclassified 2,300 drivers working in California from 2000 to 2007 as independent contractors.

Last August, the 9th U.S. Circuit Court of Appeals ruled that as many as 2,300 FedEx Ground drivers in California and Oregon were employees, not independent contractors, when they worked for the company, sending the case back to the U.S. District Court.

The financial terms of the California wage lawsuit settlement agreement, which must be approved by the federal court, would cover plaintiff claims for expenses, back compensation and legal fees dating to 2000 and will be among the largest misclassification settlements ever.

The settlement is the latest twist in a long-running battle over the use of independent contractors. Labor groups and drivers across the United States are challenging the contractor model in court, and with some success.

Still, the FedEx California wage settlement does not resolve numerous other employee misclassification lawsuits that have been filed by FedEx Ground drivers in other states, many of which remain pending in trial courts or on appeal.

Overview of California Wage Violations

Many employers aware of California labor laws still commit certain violations at the expense of their employees. An employment and labor law violation in California can include unpaid overtime and employee misclassification.

According to California wage laws, overtime pay is based on hourly wages, salaries, shift differentials, non-discretionary bonuses and commissions. Failure to include those when determining overtime pay is a violation.

In California, most workers are entitled to overtime for all work past eight hours in a day or 40 hours in a week, or for work performed on a seventh consecutive day.

Simply being paid a salary does not make an employee exempt from overtime. Salaried employees are entitled to overtime compensation as well, provided that an overtime exemption does not apply to them.

Additionally, some California employers misclassify their employees as exempt from overtime, either due to a lack of understanding of the exemptions or to save money.

If you are employed in California and believe that your employer has violated a federal or California employment law, you may qualify for damages that may be awarded in a possible California wage class action or lawsuit.

Join a Free California Overtime, Wage & Hour Class Action Lawsuit Investigation

If you were forced to work off the clock or without overtime pay in California within the past 2 to 3 years, you have rights – and you don’t have to take on the company alone.

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