Conservative Kansas Joins The Liberal Ninth Circuit In Rejecting The Independent Contractor Classification Of Delivery Drivers

Last month we blogged about two Ninth Circuit opinions that deemed FedEx Ground drivers to be employees rather than independent contractors under California and Oregon law. Last week the Kansas Supreme Court joined them, applying Kansas law to reach the same conclusion in Craig v. FedEx Ground System, Inc. (Oct 3, 2014).

While the Ninth Circuit tends to lean pro-employee in its decisions, Kansas is decidedly more conservative. The Kansas Court's decision, therefore, may prove more influential to other courts across the country, as independent contractor misclassification cases continue to populate their dockets.

All three cases are appeals from a December 2010 trial court decision that had mostly upheld the FedEx Ground model of treating its delivery drivers as independent contractors. In Re FedEx Ground Package System, Inc., 758 F.Supp.2d 638 (N.D. Ind. 2010). That 2010 decision, which analyzed the drivers' status under multiple laws across 26 states, had held that the drivers were independent contractors under the laws of 23 states and employees under three. The appeals from that case are now being heard by various appellate courts, which are applying different tests and different standards based on which state's laws they are interpreting. So far, the appellate decisions are trending toward deeming the drivers to be employees, thereby reversing the original 2010 decision.

The Kansas Supreme Court held that under Kansas wage payment law, a 20-factor test must be applied to determine whether drivers are employees or independent contractors. The 20-factor test is similar, but not identical, to the 20-factor test that the Internal Revenue Service formerly used to analyze employment under the Internal Revenue Code. The Kansas test incorporates aspects of common law right-to-control tests and aspects of the economic realities test used under the Fair Labor Standards Act, but places the "primary focus" on an employer's right of control.

Although the Kansas test is different...