Brown Bailout?

[Guest uofmeet]

Anyone else heard about this?

http://www.brownbailout.com/?fbid=mBlf0STOZLX

[Guest jackdm3]

"What can Brown do to you?"

[Smith]

One word - Unions

[Rightwinger]

Somebody at UPS has been reading Atlas Shrugged but misinterpreted what she was trying to convey.

Yep, Unions.

[Guest 6.8 AR]

If Oberstar gets his hooks in Brown and Fedex, the unions have won big(union leaders, that is) and the businesses will perish. Yep, someone didn't get it.

Sent from my iPhone using Tapatalk

[Smith]

If Oberstar gets his hooks in Brown and Fedex, the unions have won big(union leaders, that is) and the businesses will perish. Yep, someone didn't get it.

Sent from my iPhone using Tapatalk

Well FedEx isn't unionized so there is hope. However, if they get a hold of UPS then they will use it to bailout the USPS and destroy them both. It would make DSL look great!

[Oh Shoot]

Well FedEx isn't unionized so there is hope.

If ever a company SHOULD be unionized it is FedEx Express. The other Smith has kept it regulated by the Railway Labor Act of 1926 by greasing palms in Congress since he fired it up.

Basically, FedEx is classified as an airline, UPS as a trucking company. Each has about as many planes and trucks as the other.

Then, when FedEx bought out RPS to begin FedEx Ground to overnight compete with UPS, Smith launched the biggest scam of all, the "independent contractor" model. FedEx pays many millions in legal fees and settlements annually to defend against all the lawsuits, including a huge federal class action one, but with such deep pockets, it hasn't even really affected the stock. The Ground Scam has ruined many many lives, and is getting dirtier daily as FedEx keeps changing the terms to skirt each court ruling. TN is the latest state where overnight, contractors have now been informed they must incorporate and own a minimum of three route areas, and not only that, must now blind bid each area against their own fellow drivers. Etc etc. Enough of all that. It's dirty, really dirty.

UPS has managed to do pretty well with a union, eh? And while the job is no piece of cake, and the guys get plenty of abuse and micro-managing, their top out salaries and now ten bucks more per hour than FedEx Express, and those guys just don't top out, either. FedEx doesn't much care, since the overnight part of the biz is now minimal compared to Ground. Matter of fact, they could probably just nuke it and not affect them all that much over time. At any rate, UPS has had legitimate gripe about unfair competition with FedEx over the ground biz, since UPS doesn't get the federal labor law breaks that FedEx has enjoyed since it fired up the bogus contractor model with essentially no cash outlay no where near the labor law oversight. Although it is actually the individual states that have made the biggest clamor, mainly over all the lost tax revenues that FedEx avoids by misclassifying its workforce.

It would make DSL look great![/CODE]

I guess you mean DHL.

Which went bust in the US domestic market, actually trying to do what FedEx Ground is doing, because they didn't have deep enough pockets to bribe the right people. Oh, I mean, "successfully lobby" on capitol hill.

- OS

[mcurrier]

It's a done deal. They're merging and changing the name to American Shipping Service. I wonder what people will call it for short?

[Smith]

OS, I agree there are problems with Fedex but the reality is UPS is requesting our money to do business which essential will turn it into a government business. Maybe the regulations should be more along the lines of what Fedex is using instead of UPS. Or maybe the government should get out of it all together.

However all the above is not really the issue. The issue is the Obama administration and the unions see a great opportunity to get their greedy hands on a decent business in order to exploit it. There is no way this will improve anything UPS or Fedex related.

[Guest grimel]

If ever a company SHOULD be unionized it is FedEx Express. The other Smith has kept it regulated by the Railway Labor Act of 1926 by greasing palms in Congress since he fired it up.

Basically, FedEx is classified as an airline, UPS as a trucking company. Each has about as many planes and trucks as the other.

FedEX is predominately air. Don't really care how they run their business. Don't care what they pay. If the Fed Ex drivers don't like it, go some place else. You couldn't swing a dead cat without hitting someone wanting a driver 5yrs ago. As for an unfair advantage, UPS unionized. If they can't compete they need to go under, reorganize and boot the union out.

Bottom line, UPS wants to control how FedEx does business so UPS will do better. Don't like how your business is fairing, change how you do business. Instead of working to get union concessions, UPS wants the fed to intervene.

As for misclassified drivers, who owns the truck? who pays for the truck? who pays the fuel & insurance? What do you call an independent contractor?

[Sean S.]

FedEx fleet: FedEx Express | About FedEx

Started as an airline and correclty classified under the RLA.

Air Fleet

664 aircraft

Delivery Fleet

Approximately 41,000 motorized vehicles

UPS fleet: UPS Fact Sheet - UPS Pressroom

Started as a trucking company and added an airline division which should be separated from the trucking company and reclassified under the RLA.

Delivery fleet 96,105 package cars, vans, tractors, motorcycles, including 2,060 alternative-fuel vehicles

UPS jet aircraft 214 in service

Chartered aircraft 299

[Oh Shoot]

FedEX is predominately air.

Probably, but not big a very big margin anymore.

Average quarterly income all divisions, about 9 billion.

Ground is 2 billion, Freight is big, but couldn't find breakdown past that.

Many other divisions, too, all the way to Kinkos (now FedEx Office).

Biggest telling moneymaker: Ground operating about about 17% operating margin, all other divisions lower. Express is 7% or less.

As for misclassified drivers, who owns the truck? who pays for the truck? who pays the fuel & insurance? What do you call an independent contractor?

There are a number of other criterion for contractor vs. employee status. So far, FedEx has failed every one of them in both state and federal courts.

The contractors don't really WANT to be employees, they want to be independent contractors. But since part of the contract says that FedEx can change the contract at any time, it's not worth the blood it's written with. So the courts keep negating the contract, and FedEx keeps rearranging things long enough to stave off things and keep turning a profit until the next round of lawsuits make it change again. Been going on for over 10 years now.

- OS

Edited July 27, 2010 by OhShoot
fixed quotes

[Sean S.]

FedEx 4th quarter earnings: 9.43B

Of that Express overnight was 5.88B (planes and company owned trucks)

More facts can be found at FedEx Corporation - Investor Relations - Acquisition History

[Oh Shoot]

FedEx fleet: FedEx Express | About FedEx

Delivery Fleet

Approximately 41,000 motorized vehicles

UPS fleet: UPS Fact Sheet - UPS Pressroom

Delivery fleet 96,105 package cars, vans, tractors, motorcycles, including 2,060 alternative-fuel vehicles

Add > 50,000 Ground Vehicles to the FedEx "not a trucking company" total

- OS

[Sean S.]

Add > 50,000 Ground Vehicles to the FedEx "not a trucking company" total

- OS

I appreciate your opinion but you should check your facts. The information is available on both UPS and FedEx on their respective investors relations web pages.

[Oh Shoot]

"Add > 50,000 Ground Vehicles to the FedEx "not a trucking company" total"

I appreciate your opinion but you should check your facts. The information is available on both UPS and FedEx on their respective investors relations web pages.

The vehicle total you quoted was Express only.

I simply pointed out that added with Ground division vehicles, FedEx actually has as many branded trucks on the road as UPS.

- OS

[Sean S.]

The vehicle total you quoted was Express only.

I simply pointed out that added with Ground division vehicles, FedEx actually has as many branded trucks on the road as UPS.

- OS

You are correct, my mistake...

Added: The real issue is UPS has been unsuccessful in splitting their airline out from their trucking business. If they did that, they would easily fall under the RLA, which protects interstate commerce. In reality, they should be under the RLA for their airline. Since UPS cannot get out from under the union they decided to lobby congress to change the law to affect one company who happens to be their only US competitor.

Edited July 27, 2010 by Sean S.

[Oh Shoot]

You are correct, my mistake...

Added: The real issue is UPS has been unsuccessful in splitting their airline out from their trucking business. If they did that, they would easily fall under the RLA, which protects interstate commerce. In reality, they should be under the RLA for their airline. Since UPS cannot get out from under the union they decided to lobby congress to change the law to affect one company who happens to be their only US competitor.

I don't see how UPS air service and RLA has much to do with unions.

FedEx pilots ARE unionized, the only phase of the entire FedEx effort that is.

UPS didn't care about FedEx's Express/Air division. It was when FedEx jumped into Ground that they started asking for what they considered unfair competition.

Their Ground operations are run exactly the same, EXCEPT that FedEx doesn't have to pay drivers or buy trucks. And since the "independent contractor model" has been shown to be bogus over and over in court, I can't blame them for at least demanding a level playing field.

Again, look at the profit margin of FedEx Ground, 17% compared to 7% for Express (which puts the two divisions in much closer equality as to the bottom line), because of the way they've been able to operate with no employee benefits and shunt off all the operating expenses onto contractors. Which would be fine, IF the "contractors" really were that. But every detail of a contractor's business beyond truck ownership/maintenance is dictated by FedEx. Indeed, in ways to numerous to go into here, Ground determines just what any given contractor can actually earn. UPS has watched this process in the courts, and since there is now a long precedence for continually finding that contractor model illegal, has redoubled it's efforts to leveling the playing field.

It's not like UPS cares if FedEx unionizes, it just wants it to have to have to compete with the same normal overhead that it does. Again, the big difference is Ground, and not Express.

Of course, the Teamsters want FedEx removed from the RLA, as that will make unionizing probably a foregone conclusion over time, but UPS's interest is purely market share driven. Fedex Ground can constantly lowball UPS ground delivery, especially on heavier items, because it has no employees.

DHL, as far as I can tell, actually DID run it's terminals fairly, as far as the treatment of its contractors, but it found that it couldn't compete with FedEx Ground OR UPS, because it just couldn't undercut either of them to build up volume and make a profit, FedEx Ground because of its super fast growth due to illegal personnel operations or UPS because of it's simple steady volume built up over a long time of slow but law abiding growth.

- OS

[Guest grimel]

There are a number of other criterion for contractor vs. employee status. So far, FedEx has failed every one of them in both state and federal courts.

What have they failed? Specifics, please.

The contractors don't really WANT to be employees, they want to be independent contractors. But since part of the contract says that FedEx can change the contract at any time, it's not worth the blood it's written with.

I can't think of any contract that can't be changed/ended about anytime.

So the courts keep negating the contract, and FedEx keeps rearranging things long enough to stave off things and keep turning a profit until the next round of lawsuits make it change again. Been going on for over 10 years now.

- OS

Who is taking them to court the contractors? Or is it some gov folks who want to extort more money from FedEX?

[Guest grimel]

And since the "independent contractor model" has been shown to be bogus over and over in court, I can't blame them for at least demanding a level playing field.

Again, look at the profit margin of FedEx Ground, 17% compared to 7% for Express (which puts the two divisions in much closer equality as to the bottom line), because of the way they've been able to operate with no employee benefits and shunt off all the operating expenses onto contractors. Which would be fine, IF the "contractors" really were that. But every detail of a contractor's business beyond truck ownership/maintenance is dictated by FedEx. Indeed, in ways to numerous to go into here, Ground determines just what any given contractor can actually earn. UPS has watched this process in the courts, and since there is now a long precedence for continually finding that contractor model illegal, has redoubled it's efforts to leveling the playing field.

So Panther and the rest are illegal, yet, only FedEX (because UPS can't compete) is being targeted?

It's not like UPS cares if FedEx unionizes, it just wants it to have to have to compete with the same normal overhead that it does. Again, the big difference is Ground, and not Express.

Of course, the Teamsters want FedEx removed from the RLA, as that will make unionizing probably a foregone conclusion over time, but UPS's interest is purely market share driven. Fedex Ground can constantly lowball UPS ground delivery, especially on heavier items, because it has no employees.

Um, you just gave the reasons UPS wants FedEX unionized - to make sure FedEX has the same overhead. FYI, there is NOTHING that says if FedEX bought the trucks, hired the contractors as drivers that FedEX's costs would go up. There is NOTHING requiring FedEX to have any benefits. FedEX can price lower than UPS because FedEX isn't paying Union benefits. UPS needs to deal with it an move on.

As for the Teamsters, I'm not sure what makes you think unionization would be a forgone conclusion over time. Other than the government unions unionization is on the way out.

FedEx Ground because of its super fast growth due to illegal personnel operations or UPS because of it's simple steady volume built up over a long time of slow but law abiding growth.

- OS

Okay, we get it you don't like FedEX not being unionized. What SPECIFICALLY is FedEX doing that is illegal? Oh, more importantly, what on earth makes you think especially in the current job market that even if FedEx hired the contractors and bought their trucks anything significant would change in their costs? UPS wants FedEX unionized.

[Guest KimberChick]

While not in favor of unionization by any stretch, I cannot support a company that will attempt to fire an employee for "excessive absence" that was entirely due to hospitalization for bacterial meningitis. That's that Fedex attempted to do to me and I later learned it was a fairly common bully tactic(i.e. don't get sick if you're a good employee, we need to to come in and take up for slackasses) within the Hub. Unblemished employment record, get sick, come back to a "decision day" wherein I had to draft a multi-page letter detailing what happened, how I was wrong and what I'd do to prevent the situation in the future. I told them that, should I contract a such a disease again, I'd come to work and generously spread it around as much as I could before it took my life. I still have the letter somewhere. They were not amused but I really didn't care at that point.

And no, they weren't successful in firing me. I found a better job and quit about a year later. I think that might be part of what has motivated Fed's people to attempt to unionize, lol.

[Oh Shoot]

What have they failed? Specifics, please.

It would take a novelette to answer those few questions completely, and here is certainly not the place, even if I had the stamina.

Here is quick Wiki overview and IRS publication link for the "20 factor" test for employee/contractor status. FedEx has failed the majority of the criteria in the various court views:

Misclassification of employees as independent contractors - Wikipedia, the free encyclopedia

I can't think of any contract that can't be changed/ended about anytime.

Yep, and FedEx does it all the time, and then ensures that he gets next to zip when forced to sell out, effectively financially ruining the guy's life.

Contracts are blanket for all contractors within a state, no individual negotiation, until forced by court, then FedEx changes the model for the whole state until the next challenge.

Who is taking them to court the contractors? Or is it some gov folks who want to extort more money from FedEX?

Started out with individual contractors all over the US, turned into first class action suit in Kali, then class actions in 34 other states, now most of those consolidated into Federal class action that has been underway for 1.5 years.

About half the states have investigated and or taken action regarding employment tax issues from classification issues.

IRS slapped them with multi-billion dollar bill for one year, negotiated it down, is now looking at other years, but mostly waiting on the Federally consolidated class action to resolve as a precedent.

All this is a fraction of what's transpired.

If you're really interested in more overviews of the sagas, I'll post some links, but a search for "FedEx Ground lawsuits" "FedEx Ground independent contractors" and the like should keep you busy for some time.

Actually, here's one, although it is maintained by litigants, that can give you somewhat of a concentrated overview of the saga, including state by state:

FedEx Drivers Lawsuit

If you really are interested enough to want to ferret out the horror stories that put the personal, human face on the whole debacle, you can spend a week or two at:

http://www.fedexaminer.com/

Probably about all I'm going to say about it, as this has become somewhat tangential to the whole topic, and certainly this isn't even the forum where I should have already expend even this much energy on the subject.

And just to be clear, I'm not trying to make an overall case of Union=Good in this matter, only that FedEx has indeed been allowed to compete unfairly in exactly the same business that UPS conducts. If resolving that lets in the likelihood of the Teamsters organizing FedEx, so be it.

- OS

Edited July 27, 2010 by OhShoot