Case Update: The 9th Circuit Sides with Employees in an Employee vs. Independent Contractor Dispute

In Alexander v. FedEx Ground Package System Inc, former FedEx drivers from California and Oregon filed lawsuits against FedEx alleging they are owed unpaid wages under state and federal law. In August of this year, the 9th Circuit Court of Appeals reversed a lower court ruling and approved the lawsuits to move forward holding that the former FedEx drivers were in fact employees, and not independent contractors.

Alexander discusses the differences between employees and independent contractors, and the different rights and entitlements of these two groups under state and federal laws. Simply put, FedEx argued that the drivers were independent contractors and therefore not entitled to the protections and unpaid wages the group was alleging whereas the drivers argued that they were employees of Fedex, and therefore were entitled to the protections and unpaid wages they were alleging.

Independent Contractor Misclassification Standards

In determining whether workers are either employees or independent contractors, both Federal and California courts will look at a number of factors, including, but not limited to: the employer’s right to control the manner and means of the employee’s performance, the employee’s skill required to do the job, who provides the equipment and materials required to do the job, whether compensation is by time or per diem, whether the parties believe they are creating an employment or independent contractor relationship, length of time for which the services are to be performed, and whether the service rendered is an integral part of the employer’s business. It should be noted that this list is not exhaustive, it is just some of the factors courts will consider in determining whether a worker is an employee or independent contractors. The importance and weight given to each factor depends on each circumstance. But the courts often find the right to control the manner and means of the employee’s performance as the most important factor to consider.

The case held that the drivers were employees, not independent contractors. In deciding this, the Court noted a variety of factors which led to its ruling that the FedEx drivers were employees. The Court noted that the drivers wear FedEx uniforms, drive FedEx approved vehicles, and are told where and when to deliver packages. In this case, the 9th Circuit placed substantial weight on the employer’s right to control the manner and means of employee’s performance. Essentially, because the drivers were told how to do their job, specifically what hours to work as well as when and where to make deliveries, the drivers constituted employees, not independent contractors.

At the end of the day, this is a huge win for laborers. Even though a laborer may be classified as an independent contractor, he or she may nonetheless pursue damages for unpaid wages if their job description and duties can be described as an employee. Alexander v. FedEx Ground Package System Inc. clarifies that if a laborer categorized as an independent contractor is performing as an employee, then he or she can still allege damages for unpaid wages as if he or she was an employee.

Leave a Comment

Filed under Wage & Hour

Comments are closed.