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$2 million misclassification settlement with FedEx: New York state

December 21, 2018

New York State reached a $2 million settlement with FedEx for misclassifying drivers as independent contractors.

The $2 million will be distributed to an estimated 500 drivers for FedEx Ground and its division, FedEx Home Delivery, the New York Attorney General’s office announced Thursday. The lawsuit, initially filed in October 2010, had sought unpaid overtime and unlawful deductions from wages.

“Companies cannot misclassify employees in order to dodge their legal obligations — period,” Attorney General Barbara Underwood said. “We will continue to hold accountable employers who fail to pay workers the wages they’re owed under the law.”

Overall, more than $33 million in wages taken from workers have been recovered for 22,000 workers across New York since 2011, the Attorney General’s office said. Earlier this year, it announced another misclassification case against three Queens construction companies that resulted in $371,000 in wages being recovered for workers.

In the FedEx case, drivers to receive money are divided into two groups:

  • Unpaid overtime will go to FedEx Ground and FedEx Home drivers who entered into an operating agreement with the company on or after Aug. 10, 2005; provided services to FedEx Group up to September 2016; and drove more than 40 hours a week.
  • Unlawful deductions will go to drivers who entered into an operating agreement between Oct. 15, 2007, and Sept. 11, 2009, and provided services to FedEx Ground up to September 2016.

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