Filed under: News
I think of FedEx as an employee-friendly company. For example, the entire company closes on Christmas to ensure that all employees can enjoy the holiday. Thus, it was surprising to learn that FedEx may be sued by the three states of New York, Montanta and New Jersey for intentionally denying 1,000 contractors the benefits they should receive as full employees. I guess they only commit (alleged) labor violations against non-employees.
Reuters reports: “Three U.S. states said on Tuesday they plan to sue FedEx Corp, accusing the second-largest U.S. package delivery company of violating labor laws by illegally classifying drivers as independent contractors rather than employees to save money.”
Now to be fair, FedEx claims their contractors operate more like the owners of a franchise, who use the FedEx brand, but in essence operate their own small businesses, so there are no labor violations. In fact, FedEx released a statement promising to “vigorously defend the right of FedEx Ground independent contractors to own and operate their businesses.” So why may FedEx being getting sued? By not one but THREE states?
FedEx does not give contractors benefits like worker’s compensation protection, but still charges them high fees to use its equipment. This would be fine, except that the company strictly manages drivers with detailed rules regarding hours and uniforms, among other areas. Honestly, something in the milk ain’t clean. It’s clear that FedEx is in fact controlling these drivers like full-time employees, while making them take on the risk and expenses of an owner. I hope FedEx goes down on this one.
The three states of New York, Montanta and New Jersey have given FedEx until October 27 to prove that these allegations are false. Then the law suit against FedEx will proceed, hopefully empowering these workers to receive fair compensation for their labor.
Accusation:California filed a $222 million lawsuit against the owner of 22 Midas Muffler shops after uncover agents discovered in which consumers were charged for unneeded repairs, California Attorney General Edmund G. Brown Jr. announced. Click through to see more stores that got caught cheating.
Gotcha Moments of Retail Shame
Store: Midas
Accusation:California filed a $222 million lawsuit against the owner of 22 Midas Muffler shops after uncover agents discovered in which consumers were charged for unneeded repairs, California Attorney General Edmund G. Brown Jr. announced. Click through to see more stores that got caught cheating.
Store: CVS
Accusation:California caught the chain with expired merchandise on the shelf. The result? CVS must give $2 coupons to anyone finding more expired items. This isn’t the first store caught doing something shady (or even the first time CVS was caught doing the same thing). See more Gotcha Moments by clicking through.
Store: Kmart
Accusation:Marketed paper products as biodegradable that aren’t actually biodegradable. The result? Kmart settled the case with the Federal Trade commission. This isn’t the first time KMart was caught.
AFP/Getty Images
KMart’s Previous Gotcha:Kmart, Ashley, and World Market< were accused of deceptive furniture labeling — wood that wasn”t wood and leather that wasn”t leather — in an on-camera investigation by Good Morning America The result? Kmart said full product descriptions were available online, Ashley defended its wording as a description of color only, and World Market acknowledged that a quarter of its supposedly leather chairs were actually synthetic, and it pulled them from sale.
Sears Holdings Management Corp., the parent company of Sears and Kmart, settled a case to stop enticing customers to sign up for a software that spies on them. It must also instruct customers how to uninstall the software that monitored their spending across the web, even on sites that are supposed to be secure, and destroy the data that was collected. The Federal Trade Commission brought the case against the Sears Holdings.
Quizno’s Sub Shop has an online video ad showing two girls simulating a porn video by sharing a sub sandwich. The online ad, “2 Girls, 1 Sub,” takes its name from a notoriously heinous movie trailer, for a fetish film, which shows women eating their own feces. Critics have pointed out that the Quiznos video, starring Playboy Playmate Hiromi Oshima, is basically comparing the sandwiches to “poop.”
This is Quizno’s second porn-themed ad to come out in recent months.
If you are dining out — and many of us still are these days, despite the economy — make sure to check your bill carefully for extra charges that might creep on there.
Call it the airline a la carte approach, as many restaurants are apparently sneaking in charges for bread, tap water, takeout boxes and mandatory tips. The New York Post found all of these items added to bills on an investigative mission that the paper undertook recently.
For more on advertisers caught misleading consumers, click through our gallery of Gotcha Moments of Retail Shame.
Blockbuster was found guilty of charging customers higher than the advertised prices on scanned items by district attorneys of Los Angeles and San Diego counties. Blockbuster owes $237,750 in penalties, and $62,250 in costs, and is further prohibited from charging amounts greater than the advertised price.
A regulatory organization for the advertising industry demanded that Wrigley change its misleading packaging and advertising for Eclipse gum. The ads for Eclipse say that the gum’s natural ingredient – magnolia bark extract – kills germs that cause bad breath. This has not been proven and the National Advertising Division Council of Better Business Bureaus asks that Wrigley clarify this in its ads.
Store:Chase Bank
Accusation: In late March, the bank rescinded a $10 monthly fee it had imposed for several months on hundreds of thousands of credit card accounts, after New York’s attorney general decried the practice as a bait-and-switch for customers seeking low interest rates.
Results:The settlement could save customers $22 million over the next year.
Amy Sancetta, AP
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