Writing for a three-judge panel of the California Court of Appeal, Justice Miriam A. Vogel observed that "the parties' label is not dispositive and will be ignored if their actual conduct establishes a different relationship." The court also upheld the certification of the case as a class action but sent it back to the trial court for a recalculation of the reimbursable expenses and a reduction in the amount of attorneys' fees to be paid by FedEx.

Drivers were required to lease a scanner, purchase or lease a truck meeting FedEx's specifications, mark the truck with the FedEx logo, and pay all costs for the truck. Frequently, drivers relied on a "business support package" from FedEx to fund this equipment, the cost of which they repay by deductions from their weekly "settlements" or paychecks.

However, the court said, the drivers were subject to strict oversight. They were expected to wear a FedEx uniform. Terminal managers supervised and trained them. They worked full time under hours set by FedEx and were forbidden to refuse a delivery. Each driver received an annual progress review. The appeals court concluded that "the drivers look like FedEx employees, act like FedEx employees, are paid like FedEx employees, and receive many employee benefits" and therefore were FedEx employees within the meaning of Labor Code Section 2802.

The court added, "FedEx's control over every exquisite detail of the drivers' performance, including the color of their socks and the style of their hair, supports the trial court's conclusion that the drivers are employees, not independent contractors." Based on these facts, the appeals court rejected FedEx's contention that drivers were independent contractors.

Whole story -

FedEx Truck Drivers are Employees, Not Independent Contractors, Court Rules | Teamsters for a Democratic Union