FedEx Drivers Were Employees For Purposes Of Obtaining Reimbursement For Expenses

Estrada v. FedEx Ground Package Sys., Inc., 154 Cal. App. 4th 1 (2007)

Anthony Estrada, a former driver for FedEx, alleged unfair business practices under Business & Professions Code § 17200, contending that the pick-up and delivery drivers were improperly classified as “independent contractors” rather than employees and, as a result, they were owed reimbursement for employment-related expenses as required by Labor Code § 2802. The Court of Appeal agreed, concluding that the drivers were “totally integrated into the FedEx operation,” that they performed work essential to FedEx’s core business, that their customers were those assigned to them by FedEx, that no specialized skills were required, that they were required to wear uniforms and conform absolutely to FedEx’s standards and, in the end, each driver had a job with “little or no entrepreneurial opportunities.” Therefore, the drivers were entitled to recover reasonable compensation for the business expenses they had incurred. However, the Court of Appeal reversed the trial court’s award of $12.4 million in attorneys’ fees as “excessive.”