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CA Supreme Court Limits Employment Claims, FedEx Loses Appeal of Class Action, How FexEd Could Hurt Uber/Lyft, The History of Labor Day

California Supreme Court Limits Employment Claims Against Franchisors

In an acknowledgment of the modern reality of the franchise business model in California, and indeed in the United States, the California Supreme Court provided franchisors with a significant victory by reaffirming the contractual benefits that both parties to a franchise relationship receive, while further defining the limits of liability for employment claims brought by employees of franchisees who seek to name the franchisor as a defendant.

In Patterson v. Domino’s Pizza, LLC, the issue before the California Supreme Court was whether a franchisor stands in an employment or agency relationship with the franchisee and its employees for purposes of holding the franchisor liable for workplace injuries allegedly inflicted by one employee of the franchisee while supervising another employee of the franchisee. In this case, the plaintiff, Taylor Patterson, had brought claims for sexual harassment under California’s Fair Employment and Housing Act and named her employer, franchisee Sui Juris, her individual supervisor, and the franchisor, Domino’s Pizza LLC, as defendants. Domino’s was named on the theory that it was Patterson’s “employer” and that each defendant was the agent, employee, servant and joint venturer of the other defendants…

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FedEx Ground Loses Appeal Of Contractor Class Action

The relationship between employer and employee can be complicated, and when it comes to contractors and temps, the lines blur even further. FedEx Ground, a subsidiary of FedEx, received word that its alleged smudging of those lines will be up for discussion in a class action lawsuit being brought by over 2000 drivers.

In their initial suit, drivers alleged that between 2000 and 2007, FedEx shifted the status of full-time employees to contractors in multiple states, illegally saddling them with costs, including those associated with operation. FedEx allegedly required contractors to cover costs ranging from paying for equipment to the use of FedEx-branded trucks and uniforms. Overtime pay and benefits were also avoided by changing employee status.

FedEx attempted to have an initial decision allowing the class action to move forward appealed, arguing that as contractors those workers were not subject to the same rights as full time employees and could therefore be required to pay for equipment in the fulfillment of their duties. On Aug 27 however, a 9th Circuit court of appeals three-judge panel found that because the company had broad control over the way those employees did their jobs, they should be considered full time employees…

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How A Ruling Against FedEx Could Hammer Uber, Lyft

A federal court panel ruling last week holding that FedEx drivers were misclassified as independent contractors could have major implications for “sharing economy” companies — firms that provide services ranging from on-demand transportation to food delivery, maid service, grocery shopping and errand running.

“I view the decision in our case as one that should be powerfully influential in challenges to the use of independent contractors in the ‘sharing economy,’ ” lead plaintiffs attorneyBeth Ross, who filed the first challenge to FedEx’s independent contractor policy in 2005. After that, similar challenges were filed in about 40 states.

The list of potential targets starts with Uber Technologies and Lyft, both of which have been sued by drivers who serve customers who use the “ridesharing” services. The drivers contend they should be considered employees. Neither company responded to requests for comment…

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The Labor Department’s History of Labor Day

Labor Day means more than one last trip to the beach or getting everyone ready to go back to school. According to the U.S. Department of Labor, which has posted a history of the September holiday, it’s about the “creation of the labor movement and is dedicated to the social and economic achievements of American workers.”

Let’s put the hot dog down and take a closer look at Labor Day’s history:

  • Legislation: The holiday started municipally, and then was introduced statewide in New York. However, Oregon became the first state to pass a law making it official on Feb. 21, 1887, and that same year Colorado, Massachusetts, New Jersey and New York citizens also got to have a long weekend. In 1894, 23 other states signed on, and Congress passed an act making the first Monday in September a legal holiday in the District of Columbia and territories.
  • Thank you, _____?: The DOL isn’t quite sure who we have to thank for the workers’ holiday, but one suggestion is the general secretary of the Brotherhood of Carpenters and Joiners, Peter McGuire. He was also a cofounder of the American Federation of Labor, and records suggest he thought a day should be set aside to honor those “who from rude nature have delved and carved all the grandeur we behold.” Others say Matthew Maguire, a machinist, first proposed the holiday in 1882 while he was the secretary of the Central Labor Union in New York.
  • Celebrations: Hikes, picnics, beach trips—these weren’t the traditional trappings of Labor Day festivities. The DOL explains the celebratory plans first outlined in proposals for Labor Day included a street parade to exhibit the strength and spirit of labor organizations, followed by a public festival.

Though the DOL notes the holiday has changed in recent years, it characterizes the change as “more a shift in emphasis and medium of expression. Labor Day addresses by leading union officials, industrialists, educators, clerics and government officials are given wide coverage in newspapers, radio and television.”

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