Teamsters Says FedEx To Pay $26-$23 Mln To Abandon Contractor Model In California

[Omaha Steve]

http://www.rttnews.com/sp/Quickfactsnew.asp?date=09/21/2007&item=71

9/21/2007 12:16:14 PM Friday, a statement issued by International Brotherhood of Teamsters said FedEx Corp. (FDX) could pay severance costs of about $26-$33 million alone for abandoning its contractor model in California, a change announced Thursday by FedEx chief executive Fred Smith. The Teamsters noted that the estimated payment is on the top of the $17.8 million judgment awarded to drivers in California in civil litigation now under appeal by FedEx.

According to Temsters, FedEx is offering special incentives to encourage single-route contractors to transform their operations into multiple route businesses or sell their routes to others.