FedEx Ground vs California Employment Development Dept.

This case stems from the California Employment Development Dept. audit of FedEx Ground finished in 2004 where the EDD determined that FedEx Ground drivers were employees.  The EDD assessed FedEx Ground owed more than $7.88 million in back payments to California.  The audit covered the period July 2001 to June 2004 and concluded that the linehaul drivers and multi-route drivers are contractors while the single-route drivers are employees.

FedEx Ground appealed the EDD determination to the California Unemployment Insurance Appeals Board.  The EDD audit was submitted as an exhibit to the CUIAB proceedings.  WARNING: The audit is a large, scanned pdf document. 

In November 2006, the California Unemployment Insurance Appeals Board denied FedEx Ground's petition for reassessment; the EDD audit determination that single route drivers are employees stands.  The CUIAB Chief Administrative Law Judge decision demolishes much of the FedEx Ground argument to classify its single route drivers as "contractors."  

As of January 2007, FedEx Ground has appealed the EDD audit determination to the second level appeal board at the CUIAB.