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Another FedEx Contractor Ruling: What SMBs Need to Know

A new ruling from the Kansas Supreme Court has highlighted similar federal appellate court rulings concerning employee statuses. The case regards FedEx’s employee statuses. Both small and medium-sized business owners are urged to perk up at the case, and both individual and attorney attention is required.

The Ruling

Similar to a case appearing earlier this year, the Kansas Supreme Court has determined hundreds of FedEx drivers as employees—rather than independent contractors—through the state’s laws and ordinances. Data and information derived through Bloomberg.com similarly reveals a peak to the 10-year-old battle pitted between current and former drivers seeking overtime and compensation funds.

The Takeaway

Understandably, small and medium-sized business owners have watched the case keenly, and several key takeaway points have been maintained by both industry leaders and new entrants.

Firstly, a written agreement beneath Kansas’s jurisdiction underlines contract labor beneath an umbrella organization. While benefits and protection both apply, such written agreements aren’t conclusive proof for an individual’s existence as a “contractor” rather than an “employee.” Thus, workers signing agreements labeling them as contractors are still considered employees—regardless of the agreement’s wording.

Similarly, a company’s control over workers may determine the individual’s “contractor” or “worker” status. Several factors, all present within the above-mentioned case, may play integral parts in business law where determining an individual worker’s status:

  • Type of business control exercised
  • Micromanaging and worker-level arrangements
  • Specific control actions over appearance, work methods, etc.

As for the case, future classifications will likely refer to it in court, and new factors will likely fall beneath similar scrutiny as they appear. The current standing serves to balance various factors, holding independent contractor laws constant to streamline and protect contractor-based companies.

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