Saturday, December 24, 2011

Defending the FedEx Driver

Just before Christmas 2007, package-delivery company FedEx was slammed with a $319 million tax bill. The Internal Revenue Service ruled the company had misclassified about 13,000 drivers as independent contractors when, the IRS said, they really were employees.

Federal Express, whose presence in Washington is as ubiquitous as its delivery trucks, is experienced at exploiting loopholes to evade tax liability. Unlike its main rival UPS, FedEx classifies the men and women who drive its trucks as independent contractors, thereby obviating the company of the obligation to pay employment taxes.

The company is also an expert at avoiding income taxes. When it recently reported $1.9 billion in profits, it used 21 different tax havens to trim its tax liability to less than .0005 percent of its income.

FedEx also spent 42 times (4200%) more on lobbying Congress than they did in taxes. See US Uncut

FedEx’s success in getting favorable tax treatment is due in part to its successful efforts to influence lawmakers with lobbyists on Capitol Hill. The company’s PAC and employees have given $8.7 million in federal campaign contributions over the past ten years, with $797,000 of it going to members of the tax committees in the House and Senate. The company also spent $71 million in lobbying expenditures during that same ten-year period.

What got the IRS and FedEx into a tussle was the package company's assertion that drivers were contractors who operate their delivery routes as independent businesses, even though the drivers use FedEx equipment, wear FedEx uniforms and work under explicit FedEx rules.

The government argued that mis-classification of workers deprives it of billions of dollars of tax revenue annually. The Government Accountability Office has estimated the amount at $4.7 billion a year.

The FedEx bosses argued that a ruling against FedEx would upset precedents that have been in place since the 1990s.

Worker advocates counter that employers have gone too far in pushing taxes and payroll costs onto workers, effectively forcing them to subsidize their bosses.

And UPS drivers get paid more than FedEx drivers - - UPS drivers are Teamsters Union members - - FedEx does not have any union in the company except for its pilots. But if a company will cheat the government on taxes, they'll also cheat their employees.

And does FedEx also over-work their employees?

For years corporate America has been bragging about "increased worker productivity". Companies have kept wages down by doing more with less. They eliminated positions and scaled back on their payroll by delegating extra duties to their workers, and never compensating them for the extra work (Or else they were out-sourced to countries like China for people willing to work for $1 an hour).

The bosses will rarely give you a "thank you" or a warm pat on the back for a job well done, even after piling up the extra work on their employees. Instead, if someone complains, the boss reminds them of how lucky they are to even have a job. Sometimes they'll subtlety threaten them by saying, "Well if you can no longer do the job, we might have to find someone else who can."

Is that what happened to this guy in the video below?

I don't condone the man's behavior but I can certainly understand the frustration of being over-worked and under-paid, just to increase the value of a CEO's stock-options for performance for profits. I think millions of Americans feel this frustration today, and why so few have empathy for the unemployed because of their own personal hells that they're going through on their jobs.

Most of us are under a lot of pressure at work, but we try to handle the pressure, and not to take it out on the customers - - it's unethical and is disrespectful...and could cost us our jobs. And no company wants employees like that. But people are also human, and the young man's actions may have been taken out of context. As far as we know, he otherwise might have been a likeable guy and model employee until this incident was caught on tape.

Maybe there had been a prior altercation...maybe the customer had been rude, demanding, and insulting in the past. We might never know. But even though that in itself doesn't present an excuse for the young man working for FedEx, because maybe he could have simply left the box at the gate (if it was open) and/or rang the bell (if it worked).

And with record deliveries this year, FedEx may have been under-staffed and everyone was working under a great deal of pressure to accomplish their assigned tasks. Especially around the holidays when package volume increases exponentially.

The YouTube user goobie55 who posted the video said that his monitor, not surprisingly, arrived broken and had to be returned. But a well-placed security camera left him with a bit of retribution. After posting the clip, the video quickly went viral, receiving over 5 million views in just five days.

Judging by the wide arched drive-way, the tall iron fence, and the well groomed street, the customer didn't look to be hurting financially, and the monitor was insured and replaced by FedEx; so I consider it to be only a minor inconvenience for the customer when compared to the FedEx driver's livelihood. He may have children to feed.

FedEx's Senior vice president of U.S. operations Matthew Thornton said that FedEx has met with the customer, who has accepted the company’s apology. “This goes directly against all FedEx values,” Thornton said.

Thornton also said that because of employee privacy rules, he cannot disclose what will happen to the deliverer, noting only that he is “not working with customers” at the moment. (I hope he gets off with only a stiff warning.)

If fair wages were paid with more reasonable expectations of what an average human being is capable of doing well, instead of constantly pushing for ever more, there might be less burn-out on the job and more people loving the work they do...and doing it better, with less complaints from everyone.

And maybe people wouldn't go "postal".

1 comment:

  1. One of the places where all these deliveries originate from is Amazon. A spokeswoman for Amazon said it hires thousands of temporary workers for the holidays, but declined to disclose specific numbers. It said it quadrupled its staff at its warehouse in Phoenix to handle the end-of-year rush. Many current and former seasonal workers said Amazon pays about $12 an hour in exchange for long hours and tedious labor.