FedEx reaches $2 million settlement with New York over allegedly underpaying drivers

By Marian Johns | Dec 24, 2018

ALBANY — A lawsuit filed by the state of New York against FedEx Ground Package System Inc., (FedEx) alleging the company violated New York labor law has been resolved with a $2 million settlement, according to the state's Attorney General's Office. 

Attorney General Barbara Underwood's lawsuit against FedEx alleged about 500 of the company's delivery drivers were illegally classified as "independent contractors" when they were, actually, employees in an effort by the company to avoid overtime pay and the taking of "unlawful deductions" from wages. 

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

According to Underwood's office, money from the settlement will be distributed to two "classes" of FedEx drivers who were impacted. One class will receive unpaid overtime for working over 40 hours per week and the other class will be compensated for the unlawful deductions that were taken from their pay.  The timetable for the worker claims processing is pending approval from the New York County Supreme Court, the Attorney General's Office said. 


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