Corporate Watch: Fedex

FedEx has built much of its empire on low-cost business models and other illegal and unethical labor practices. By discriminating against minority workers, misclassifying workers as independent contractors, and threatening union supporters, FedEx has been involved in numerous anti-worker tactics and bad business practices. The International Brotherhood of Teamsters (IBT) supports all FedEx workers who demand to be treated with dignity and respect on the job and to receive fair pay. The goal of the IBT is to help FedEx employees secure workers' rights, protect their health and safety, and win fair pay for their hard work.

Discrimination Against Minorities

In 2002 and 2003, African-American and Latino workers filed lawsuits alleging that FedEx Express Western Region discriminated against African American and Latino hourly workers and some managers by:

• Failing to put African American and Latino workers on promotion tracks
• Providing less compensation to minority workers for similar work
• Discriminately disciplining minority workers

In September 2005, the workers won class action status for their lawsuit (Satchell v. FedEx Express). In April 2007, the workers' lawyers and FedEx Express announced a settlement to the charges in this lawsuit. The company agreed to pay nearly $55 million as part of the settlement. In addition, FedEx Express agreed to get rid of its basic skills test, provide fair access to training and promotion, and document the guaranteed fair treatment process.

Get more information about this lawsuit.

Independent Contractors

FedEx has dishonestly classified some of its workers as independent contractors in order to avoid paying them health care and retirement benefits. FedEx Ground has 14,000 independent contractors that make its domestic, non-express package deliveries. These workers pay taxes for workers' compensation, unemployment insurance and Social Security, and they purchase fuel and maintain their own trucks, all out of their own pockets. They do not receive overtime pay or vacation days. This arrangement allows FedEx to maintain control over operations while shifting costs and risks onto workers. Drivers have sued the company to challenge their independent contractor status in over 20 states. FedEx is already under court order to reclassify drivers in California, and has suffered similar defeats elsewhere.

Anti Union Campaigns

The National Labor Relations Board (NLRB) has issued complaints against FedEx Ground charging the company with unlawful threats, interrogation, bribery, soliciting grievances, creating the impression that it was spying on workers’ union activities, and firing union supporters. At the time FedEx when bought American Freightways in 2001, Teamsters Local 710 were in an organizing drive at the American Freightways facility in Summit. When FedEx management took over, they engaged in intimidation and retaliatory practices toward union supporter Tommy Grass. Grass filed unfair labor practice charges with the National Labor Relations Board. The NLRB sided with him and ruled for his reinstatement.

Health Insurance

FedEx mechanics currently pay approximately $258 a month for family health insurance coverage, while single employees pay $54 a month. In addition to the monthly costs, employees must also pay copayments, deductible and out of pocket maximums. While FedEx recently increased the yearly out of pocket health care maximum, workers are also struggling with increases in individual medical service costs and copayments. In comparison, UPS mechanics (who are covered by a Teamster-negotiated contract) have no monthly health insurance costs and UPS pays 100 percent of all medical costs and prescriptions.