The Long Arm of FedEx

FedEx driver fired over Russian accent, lawsuit says - CSMonitor.com

Happy Thanksgiving

We would like to wish all our FedEx employee's and their families a Happy Thanksgiving Day! The FedEx Watch Dogs

Love Twinkies ?

Wall street vultures are blaming workers for getting rid of your sweets—and that’s just not right.

You might have heard that Hostess Brands, the company that makes Twinkies, Ding Dongs and other desserts, filed for court permission to go out of business, and that its blaming a worker strike for the shutdown.

The Wall Street hedge fund managers who run the company have squeezed every cent out of Hostess for eight years. And they’ve put their friends with no experience in the baking industry in high-level management positions.

Hostess workers believe in their company, and we need to stand with them—sign our pledge to support workers, not greedy CEOs who will cut and run for a quick buck.

What’s happening here is a classic Bain Capital-style assault—blame the little guy to cover the greedy corporate policies that are gutting the middle class.

It’s not just happening to the workers who make the great products Americans love. What’s happening at Hostess is happening to workers all over this country. It’s wrong. And it has to stop.

Crony capitalism and poor management drove Hostess into the ground, not the workers who are now paying the price. In this struggling economy, the greedy corporate executives are willing to let 18,000 people lose their jobs—just so they can pad their pockets.

Hostess' executives are now blaming workers who’ve offered their company multiple concessions and want it to succeed. This is what’s wrecking our country.

Workers have borne the brunt of bad decision-making by executives who didn’t know anything about the baking business. And they’re the ones getting fired?

These brave workers need to know we stand with them—and we’ll stand with everyone who will take a stand against the corporate race-to-the-bottom.

TeamstersOnline

New Bid Running Ground?

The rosy news for FedEx’s executives… | footnoted.com

or else ?

this text message from Dispatch was sent the day before a video was shown to us about threats at the workplace.

the majority of the drivers at that viewing tooked that text as a threat

Prop 32

The FedEx Watch Dogs would like to thank everyone who worked so hard to defeat Prop 32. This will not only help unionized employees, but also help us non union companies. Thank You

FedEx Freight to Test LNG Trucks | Journal of Commerce

FedEx accused of thuggish tactics with drivers

FedEx Accused of Thuggish Tactics With Drivers By WILLIAM DOTINGA ShareThis (CN) - FedEx's ground delivery system uses racketeering tactics, physical assaults, extortion and flat-out fraud to duck taxes and labor laws and dump legal liabilities on drivers, whom it misclassifies as independent contractors, according to a massive federal RICO complaint. Plaintiff Carlos Rocha claims that FedEx instituted much of the alleged racketeering in response to class action lawsuits from drivers. He says he formed his company, co-plaintiff Arize 11 Inc., at the behest of FedEx, "as a means for FedEx to shield itself from tax liabilities threatened by the IRS in connection with its widespread misclassification of employees as independent contractors." In addition to FedEx Ground Package System and its subsidiaries, Rocha sued former FedEx CEO Daniel Sullivan, current COO Rodger Marticke, VP and General Counsel Clifford Johnson, CEO David Rebholz and Senior VP of Global Communications and Investor Relations William Margaritis, in Chicago Federal Court. Rocha claims all of them were involved in the conception and implementation of the company's scheme. He also accuses defendant FedEx employees Scott Ray, Nathan Watts, Jennifer Betsinger and Ralph Stephens of implementing the scheme. Rocha's 104-page complaint, filed by Lisa Johnson with Anchor Law Offices of West Palm Beach, includes 16 causes of action, including RICO violations, restraint of trade, unlawful tying arrangements, consumer fraud, deceptive trade, fraudulent inducement, tortious interference, illegal deductions from wages, breach of operating agreement, breach of faith, unjust enrichment and retaliatory firing. He filed it in the Northern District of Illinois. Rocha says FedEx's plot began when it established a new home delivery business and offered drivers across the nation a proprietary interest "defined and measured by an assigned 'Primary Service Area' or 'PSA.'" He claims FedEx marketed the opportunity through all forms of media, including mail and wire systems. To run the PSAs through the new independent contractors, FedEx required Rocha and other drivers to execute a standard operating agreement. Rocha says the primary purpose of the agreement was to "circumvent federal and state laws and unlawfully pass risks, costs and other liabilities of FedEx to members of the public through a pattern of racketeering activities." Rocha says FedEx offered him a PSA in the Chicago area in January 2006, after he spent 2 or 3 months as a temporary FedEx driver to establish his driving record. He says FedEx also required him to buy uniforms, and "one of two trucking vehicles sold by or through FedEx and one of its associated suppliers." FedEx required him to buy either a 2005 Morgan Olsen Chevy Workhorse or a 2005 International, "which were more costly and/or less economical than suitable alternatives," according to the complaint. Rocha opted for the Chevy Workhorse, at a cost of $33,410. Rocha claims "the entire Standard Operating Agreement was a sham[;] the specific misrepresentations and omissions of material facts contained in the Standard Operating Agreement are numerous." Among them, Rocha says: a. FedEx "treated and intended to continue treating its contractors executing the agreement as employees for all purposes other than the shifting of costs, risks and other liabilities to such contractors;" b. It was the company's "regular practice at the time to terminate, fine and otherwise penalize contractors for failing to meet requirements unilaterally set by it and/or without reference to relevant industry standards or any other mutually agreed objective or standard;" c. FedEx endeavored to "terminate, fine and otherwise penalize contractors for failing to comply with numerous rules, procedures and standards established by FedEx in undisclosed handbooks and manuals independent of the discretion and judgment of the contractors;" d. Though it promised autonomy, "FedEx officers and managers at the time regularly imposed additional terms and conditions on FedEx's contractors and their continued operation and FedEx formally ratified and sanctioned such conduct by enforcing those terms and conditions through contract terminations and/or requiring contractors to execute mandatory addendums to the Standard Operating Agreement." Rocha says that in addition to the cost of his truck, FedEx required him to fork out cash for truck-washing at FedEx-approved vendors, and garnished his wages for vehicle insurance. He had to provide daily pickup and delivery service at times dictated by FedEx, though the operating agreement stated that he could make his own schedule. He says FedEx held him liable for customer complaints of theft, loss or damage, whether verified or not. He had to pay FedEx employees for their "cooperation" and had to lease or buy FedEx scanners, GPS tracking equipment and "mandatory use of FedEx's unhelpful and unnecessary mapping software." "The harm caused Mr. Rocha and other drivers by their detrimental reliance upon the misrepresentations and omissions contained in the Standard Operating Agreement, and by the unlawful tie-ins for the purchase of a truck, uniforms, insurance, and other business products and services, was magnified a hundred-fold by FedEx's failure to deal in good faith with drivers after inducing them to sign its onerous and one-sided operating agreement," Rocha says in his complaint. "First, and perhaps most significantly, FedEx never honored its obligation to pay contractors for any and all FHD [FedEx Home Delivery] deliveries or pick-ups transferred to other contractors as a result of its reconfiguration of PSAs as a result of increases to the volume of customers in such PSAs, and consequently their value. FedEx reconfigured PSAs and routes routinely without the involvement of FHD contractors and neither paid amounts due contractors under 6.4 of the Standard Operating Agreement or enforced the obligation of FHD contractors receiving such deliveries and pick-ups as a result of a reconfiguration to do so." Rocha says FedEx failed to honor its own terms for payment for his PSA, and ensured his continued work through "threat, intimidation and sheer force." "In furtherance of FedEx's fraudulent scheme and unlawful business practices, Mr. Rocha and other FHD contractors were threatened with termination and/or non-renewal of their operating agreements, forfeiture of their investments and/or other economic loss if they refused to blindly execute signature pages for addendums relinquishing their rights and other proprietary interests; purchase additional products and services from FedEx; accept unlawful deductions from their pay; and/or adopt and enforce operational rules promulgated unilaterally by FedEx in violation of its covenants contained in the Standard Operating Agreement. Many, who like Mr. Rocha had financed the purchase of their trucking vehicles and/or mortgaged their homes for that purchase, were also at times barred from the Chicago terminal and denied access to their trucks remaining in FedEx's sole possession post-contract termination under the express threat of their permanent taking as an additional means used by FedEx to compel the cooperation and release of other proprietary interests held by such contractors. Even now, FedEx, and contractors acting in concert with FedEx, have withheld access to trucks from contractors wrongfully terminated and/or discharged by FedEx under threat of a trespass complaint and physical attack for periods exceeding more than a year. Contractors were often physically assaulted and/or otherwise intimidated by FedEx security and falsely accused of trespass, theft, and other forms of criminal conduct to the detriment of their reputation, or threatened with such acts, in connection with threats of being terminated and/or divested of their investments," Rocha says in his complaint. Rocha says FedEx beefed up security at its Chicago terminal in the wake of legal victories for its contractors and "FedEx replaced managers holding master degrees with high school graduates more versed in the art of intimidation." "A physical attack on one of the individuals subcontracted to drive for Arize 11, Inc. post-ISP Agreement by FedEx security in March of 2011, combined with the fear of future assault emanating from that attack would be one of the contributing factors causing Mr. Rocha to give in to extortionist demands made at the time by FedEx for the sale of all interests he and Arize 11, Inc. held in FHD to Ralph Stephens," Rocha states in the complaint. He says he wasn't the only contractor to do so. "FedEx both threatened and committed physical violence against FHD contractors and their drivers to compel their cooperation and continued investment in FHD to further such schemes. FedEx successfully induced FHD contractors to give up their trucks, money, and other proprietary interests by threats and actual use of force, violence, and fear as well as the repeated threat of greater financial loss," Rocha states. After courts in California ruled in 2004 and 2005 that FedEx contractors were actually employees, union organizers flocked in to organize the newly labeled employees. FedEx sent managers to warn them that anyone seen speaking to or assisting union organizers would be escorted from the company's property, Rocha claims. "In a July 10, 2006 letter sent to contractors after Teamster organizers and UPS drivers were found to be distributing union membership materials to FedEx contractors, FedEx's Vice President for Contractor Relations issued a formal statement of FedEx's position against the Teamster organizers and allied UPS drivers warning contractors across the nation that no one would be hurt more than them by any threat to FedEx's business model posed by the activities of these organizers," Rocha states. "Perhaps FedEx meant to say that the contractors would be hurt if the lawsuits, organizing campaigns, and other such activities threatening FedEx's business model were successful. However, it said what it really meant: that any activity threatening FedEx's business model, whether successful or not, would result in injury to the contractors." In response to the lawsuits - including several pending class actions - FedEx revised its standard operating agreement, Rocha says. But rather than implementing the new agreement, he says, FedEx launched an even more complex pattern of fraud, extortion and racketeering. "FedEx further, through its usual means of extortion, imposed significant and at all times unlawful restraints on contractors' free trade and associated rights under the Standard Operating Agreement to, among other things, recruit, hire and train helpers and replacement drivers of their own choosing and use trucking vehicles for purposes other than driving for FedEx. Though purportedly required for insurance purposes, changes made to FedEx's insurance policies were part and parcel to the same unlawful scheme and retaliatory conduct underlying the foregoing trade restraints," Rocha states in his complaint. The old agreement permitted Rocha to use his truck for other commercial or personal purposes, provided he covered up FedEx's logo and identification numbers with plastic overlay. But after the class action, FedEx went to great lengths to keep its contractors from using their trucks to make other non-FedEx deliveries - a key source of income for the drivers. "FedEx confiscated the plastic overlay purchased by Mr. Rocha and other FHD contractors with their trucks for the purpose of using their trucks for reasons outside of work for it and effectively rendered these contractors entirely reliant upon FedEx for their livelihood, without supplement or a plan B. The foregoing restraint on contractors' use of their trucks significantly decreased the bargaining power of FHD contractors and only bolstered their economic vulnerability and effectiveness of FedEx's extortionist threats," Rocha says in his complaint. FedEx also took away Rocha's right to hire his own help, but still forced him to pay $750 for training and screening, as well as the drivers' wages. "As the only FHD swing/vacation contractor in Chicago, a contract position requiring drivers with above-average skill, but having no ability to offer the pay and security other contractors with designated PSAs could offer over the course of an entire year, Mr. Rocha likely suffered more harm as a result of FedEx's staffing restraints and interference than any other contractor in the Chicago terminal," Rocha's complaint states. "Though contractors may have voluntarily agreed to assume expenses associated with persons employed or provided by them under Section 2.2 of the Standard Operating Agreement, ignoring FedEx's fraudulent inducements, they did not agree to assume the expenses associated with persons recruited, trained and otherwise employed and provided by FedEx. Yet, after usurping contractors' right to recruit and hire their own drivers and helpers, FedEx issued fraudulent 1099s and other such documents to contractors in an attempt to pass to those contractors tax liabilities associated with the persons it retained and/or otherwise provided for its own benefit and purposes. After depriving FHD contractors of their right to hire their own help, in addition to wages, FedEx forced contractors to continue paying work accident and workers compensation insurance costs for the aforementioned persons they neither employed nor provided to FedEx through unlawful and involuntary settlement/wage deductions," Rocha says in his complaint. Rocha says he tried to avoid the tax liabilities by subcontracting with FedEx employees - until FedEx made it mandatory that contractors treat all help as their own employees. Rocha says FedEx's mistreatment of the contractors didn't end there. "In 2007, after informing FedEx that he was ill and running a fever, FedEx forced Mr. Rocha to drive rather than allowing a replacement to cover his route and Mr. Rocha almost died on the road when his gall bladder burst. Fortunately, Mr. Rocha had a helper in the truck with him when his gall bladder burst and that helper was able to gain control of the truck and rush Mr. Rocha to the hospital before he would have otherwise been pronounced dead. Though FedEx did not terminate his contract during the 6-month period he spent in recovery and a replacement driver covered his route, Mr. Rocha nonetheless suffered substantial emotional distress as a result of his being forced by FedEx to drive despite a debilitating fever and the complete disregard FedEx showed for his physical well-being and the value added by the deaf helper who saved his life, who FedEx later disqualified and discharged," Rocha says. He adds that since FedEx classified him as an independent contractor he has had no health insurance, and FedEx did not pay workers' compensation or for his replacement during his 6-month recovery. Rocha's first brush with termination came after his large service area required the purchase of another van and his agreement to hire a second driver, one supposedly already screened and trained by FedEx. "Mr. Rocha agreed to use the driver referred by FedEx and within months the driver was found to have narcotics in his system after being involved in an accident with a semi truck. As a result of the foregoing accident, FedEx notified Mr. Rocha of its intent to cancel his contract in 30 days if he did not acquire trucking insurance independent of FedEx. The day before Mr. Rocha's contract with FedEx was scheduled to terminate, FedEx fraudulently induced Mr. Rocha to transfer his PSA and trucking vehicles to another contractor under the false pretense that both the PSA and vehicles transferred would be returned to him after a period of six months," the complaint states. FedEx's terminal manager then handed over Rocha's trucks to another contractor, Handzon Enterprises, which told Rocha 6 months later that the trucks belonged to it, Rocha says. "FedEx thereafter barred Mr. Rocha from the terminal area where his trucking vehicles remained parked, misappropriated the extra set of keys provided to it by Mr. Rocha in connection with his operating agreement, and exercised complete dominion over Mr. Rocha's vehicles for Handzon's use in its business. After barring Mr. Rocha from his vehicles, FedEx told Mr. Rocha, without any contractual or legal basis, that the truck taken from him was 'bound' to his contract and threatened to file a criminal complaint against him if he attempted to access his truck or otherwise remove it from the property. FedEx further told Mr. Rocha that if he wanted his PSA and vehicles returned he would have to pay Handzon. His parents at risk of losing their home used as collateral for the purchase of his trucking vehicles, Mr. Rocha paid $4,300.00 to Handzon on January 26, 2007 in an act of desperation but Handzon never returned his PSA or vehicles. Neither FedEx nor Handzon had any intent to fulfill their promise to return Mr. Rocha's PSA and vehicles after the 6 month-period and conspired at all times to defraud him of both his vehicles and PSA," Rocha states in his complaint. Rocha says he eventually got his trucks back, after FedEx fired the terminal manager. But he says his $4,300 was never returned, and FedEx made him sign a new, revised standard operating agreement. Three years later - facing another onslaught of lawsuits, including a class action in Illinois - FedEx decided to shift its business model again. Rocha says he was told that his "swing" contract would no longer be needed because contractors would be responsible for managing their own time off under the new model. FedEx offered Rocha the chance to sign the new deal - the ISP - and he reluctantly accepted, with $70,000 of debt and a mortgage on his parents' home hanging over his head. He purchased more PSAs, trucks and equipment as FedEx required. For its part, FedEx brought in accountants and provided contractors with estimated revenue projections. The company showed contractors how they could shoulder larger costs and still make the kind of money the program promised. "The ISP Offer ultimately proved to Mr. Rocha and most other contractors to be nothing more than an extension and continuation of FedEx's scheme to circumvent federal and state laws and continue its fraudulent business practices," Rocha states in his complaint. He says FedEx also omitted from its ISP transition guide that it was being sued across the U.S. again - this time for wrongful retaliation because of the ISP transition. Rocha says that transition was part of FedEx's grand scheme to combine and reconfigure PSAs into larger Contractor Service Areas (CSAs), hand the larger regions over to corporate contractors and end its relationship with small fry like him. The promised financial incentives never materialized, Rocha said. Days after FedEx forced him to transfer his rights to his company, Arize 11 - and he refused to sign a supplemental claims release - the terminal manager informed him he no longer worked for FedEx and barred him from the terminal, Rocha says. He says that instead of the $1 million in revenue FedEx promised him under the new ISP plan, FedEx sold his contract and trucks to defendant Ralph Stephens for $220,000. Rocha claims Stephens never paid him. "Upon information and belief, after Mr. Rocha transferred title to his trucking vehicles to Mr. Stephens, FedEx further interfered with plaintiffs' sale by conspiring with Mr. Stephens and aiding him in the breach of his sale agreement and the unlawful taking of Mr. Rocha's PSAs and trucking vehicles. Upon information and belief, FedEx and Mr. Stephens conspired to defraud and otherwise extort plaintiffs of their vehicles and proprietary interests and Mr. Stephens continues to use the trucking vehicles he acquired from plaintiffs to service the PSAs acquired by plaintiffs for FedEx's benefit despite failing to pay for those assets as agreed," Rocha says in his complaint. Rocha seeks rescission of contracts, declaratory relief, restitution, and compensatory, treble, and punitive damages. The complaint includes 4 exhibits, including the July 10, 2006 letter that FedEx sent to its "independent contractors;" the Standard Operating Agreement, marked "Too Large to Upload;" the Illinois ISP Transition Guide, marked Too Large to Upload; and the Transfer Document between Rocha and Handzon. A FedEx driver in New York filed a separate complaint in Westchester County Court, White Plains. In it, he claims that FedEx required that its independent contractors to incorporate and that each run at least three PSA routes. Plaintiff Cowdrey Mullings said he had just one route, so he agreed to combine with another FedEx driver, who had two. Mullings did not sue FedEx, but sued the second driver, whom he claims took over his route, fired him, and got FedEx to blacklist him.