KANSAS SUPREME COURT FINDS FXG DRIVERS TO BE EMPLOYEES
More good news on the heels of the 9th Circuit decisions in California and Oregon: The Kansas Supreme Court issued its opinion in the Craig case holding that the FedEx drivers in Kansas are employees as a matter of law under the Kansas Wage Payment Act. As you may recall, after hearing argument on the Kansas case, in August 2012 the 7th Circuit Court of Appeals certified to the Kansas Supreme Court the questions of whether the Kansas FedEx drivers are employees under Kansas law and whether the answer to that question is different for multiple route drivers. Judge Easterbrook’s order certifying the case stated that the result of the Kansas Supreme Court’s decision would “inform” the 7th Circuit on all of the other cases pending on appeal and stayed until the Kansas case is decided.
Referencing the 7th Circuit’s statement that this is a “close case,” the Kansas Court said “this is a close case by design, not happenstance” because, as FedEx’s counsel admitted at the argument, FedEx “carefully structured its operating agreements so that it could label the drivers as independent contractors in order to gain a competitive advantage.” The Kansas Court looked past the fictional labels in the contract and instead looked to the right to control that is set forth in the OA and FXG’s operating procedures to find that the plaintiffs were employees as a matter of law.
Not only did the court hold as a matter of law that the Kansas drivers were employees, but the court found “the employer/employee relationship between FedEx and a full-time delivery driver with respect to the assigned service area is not terminated or altered when the driver acquires an additional route for which he or she is not the driver.” In other words, the Court found that drivers who work full time may be employees even if they owned a second route or hired helpers. This is a huge decision, as it properly places the focus on the worker doing the work.
We are very hopeful that the 7th Circuit will adopt this decision by reversing Judge Miller’s order granting summary judgment to FedEx and directing partial summary judgment to be entered in the plaintiffs’ favor that they are employees, just as the 9th Circuit did in California and Oregon.
This is another huge victory for the plaintiffs. We will keep you informed as to new developments as they happen.
The full text of the opinion may be found here: Craig-v-Fed-Ex.pdf.