New York State Labor Department Latest to Find FedEx Illegally Classifies Package-Delivery Drivers as Independent Contractors

ALBANY, N.Y., April 3, 2008 /PRNewswire/ -- The New York Department of Labor is the latest government agency to rule that FedEx Ground/Home Delivery package-delivery drivers are company employees -- not independent contractors -- who have virtually "no control over the nature of the services they provide."

The Department's February 28, 2008 decision in the case of former long-time driver David Oberhelman, whose route was primarily in the area of Saratoga Springs and Glen Falls, applies to all single-work-area drivers in New York. Oberhelman brought the issue of misclassification to the state's attention after he was forced out of the company and filed for unemployment compensation, contending that he was entitled to the benefits like any other company employee. FedEx may appeal the decision.

Paul Reynolds, the Reviewing Examiner for the Fraud and Digests Unit of the Department, conducted extensive fact-finding and rejected all of FedEx's arguments before directing the company to report and make quarterly unemployment compensation contributions for all single-work-area drivers in New York retroactive to the beginning of 2005.

"Once again we see an impartial fact finder conclude that a FedEx driver was completely under the control of FedEx," said Peter W. Overs, Jr., Esq., of the New York firm of Harwood Feffer LLP, which is one of the Co-Lead Counsels representing hundreds of current and former FedEx Ground and Home Delivery drivers in New York who are part of the nationwide Multi-District Litigation pending against FedEx. "We are very encouraged by the adamant position of the hearing examiner that the facts supported the driver's contention that he was the victim of misclassification to his personal, professional and financial detriment and to the company's financial benefit. This is the same position we are asserting here and across the country."

The examiner notes in his opinion that Oberhelman, who wore the FedEx official uniform, drove the official FedEx vehicle, and used the official FedEx package scanner, was anything but his own boss. Reynolds said after reviewing all the facts that the driver was "not in a delivery business of his own."

The New York State ruling comes on the heels of a major decision last week by a Federal Court that has now granted class-action certification in 20 states -- including New York -- as well as nationwide, as more than 25,000 past and present FedEx Ground/Home Delivery drivers press their claims in the MDL that they were illegally classified as independent contractors.