FedEx’s $240 Million Settlement: Driver Misclassification and Overtime Rights

In 2016, FedEx Ground agreed to pay a $240 million settlement. One of the largest wage and hour settlements over the past decade, the settlement resolved cases in litigation across 20 states. The FedEx lawsuits alleged that the company misclassified thousands of workers across the nation. Classified as independent contractors, FedEx drivers were allegedly denied overtime pay, benefits, and other legal protections to which employees are entitled under state and federal employment law.

Case: Carlene M. Craig et al v. FedEx Ground Package System, Inc. et al

Court: District Court for the Northern District of Indiana

Case No.: 3:05-cv-00530-RLM-CAN

The Plaintiff: Craig v. FedEx Ground Package System, Inc.

Carlene M. Craig and thousands of other FedEx drivers brought claims, arguing they were treated like employees in practice but denied the pay and benefits to which employees are entitled under the law. They alleged that FedEx’s contractor model was designed to cut costs while shifting the burden of employment expenses onto workers.

The Defendant: Craig v. FedEx Ground Package System, Inc.

FedEx Ground Package System, Inc. is the shipping giant’s ground delivery division. The company classified drivers as “independent contractors.” However, FedEx drivers were required to wear uniforms, follow company policies and procedures, and drive FedEx vehicles. By labeling drivers as contractors, FedEx avoided paying overtime, payroll taxes, and providing employee benefits.

A History of the Case: Craig v. FedEx Ground Package System, Inc.

The misclassification lawsuits were filed in multiple states beginning in the early 2000s. Courts repeatedly found that FedEx exerted significant control over drivers’ day-to-day work, making them employees under labor laws. In 2015, the Ninth Circuit Court of Appeals ruled that FedEx drivers in Oregon and California did not meet the legal requirements and definitions of "independent contractor," but were, in fact, employees.

Facing mounting legal setbacks, FedEx agreed in 2016 to a $240 million global settlement covering claims in 20 states. The global settlement followed a $226 million settlement in California reached the year before, bringing FedEx’s total payouts in these cases to nearly $466 million.

The Main Question Being Considered: Craig v. FedEx

The central issue was whether FedEx drivers were truly independent contractors or employees. Courts evaluated the degree of control FedEx exercised over drivers’ schedules, uniforms, vehicles, and work methods. Ultimately, appellate rulings determined that FedEx’s level of control made drivers employees under the law, entitling them to overtime pay and other protections.

Why This Case Matters: Craig v. FedEx Ground Package System, Inc.

This settlement is a landmark in wage and hour law. It underscores that employers cannot simply label workers “independent contractors” to avoid legal responsibilities. For employees, the case demonstrates that overtime and wage protections apply based on the reality of the working relationship—not the title an employer uses. FedEx’s payout also forced the company to change its business model, shifting away from direct driver misclassification practices.

FAQ: Craig v. FedEx Ground Package System, Inc.

Q: What was the FedEx misclassification settlement about?

A: The settlement resolved claims that FedEx delivery drivers were misclassified, and that the misclassification as independent contractors denied drivers overtime pay and benefits.

Q: How much did FedEx agree to pay?

A: FedEx paid $240 million in 2016 to settle lawsuits in 20 states, on top of a $226 million California settlement the prior year.

Q: How many drivers were affected?

A: Approximately 12,000 FedEx Ground drivers shared in the settlement.

Q: What legal standard did courts use to decide the case?

A: Courts focused on the degree of control FedEx had over drivers’ uniforms, vehicles, schedules, and work methods, finding they were employees under labor law.

Q: Why does this case matter for workers today?

A: It shows that workers may be entitled to employee protections even if their employer labels them as contractors.

If you have questions about misclassification, overtime rights, or filing a California class action, contact Blumenthal Nordrehaug Bhowmik DeBlouw LLP. Experienced employment law attorneys are ready to help at offices in Los Angeles, San Diego, San Francisco, Sacramento, Riverside, and Chicago.

California Wrongful Termination & Retaliation Claim: Jermaine Grandberry v. Northwest Pallet Services, LLC

While labor law has built-in protections for employees, in some instances, employers violate the rights of their own workers. Jermaine Grandberry, a former Northwest Pallet Services employee, claims that his employer violated labor law by retaliating and discriminating against him in response to his complaints about unsafe working conditions and discrimination in the workplace. In response, Grandberry filed a California lawsuit claiming wrongful termination, retaliation, and discrimination.

Case: Jermaine Grandberry v. Northwest Pallet Services, LLC

Court: San Bernardino County Superior Court

Case No.: BCV-19-101284

The Plaintiff: Former Northwest Pallet Services Worker

Jermaine Grandberry, the plaintiff, is a former employee of Northwest Pallet Services, LLC. Grandberry alleges that the company subjected him to workplace retaliation and wrongful termination after he reported unsafe working conditions and discriminatory practices on the job. Additionally, he claims that his concerns were made in good faith to protect the safety of himself and his co-workers.

The Defendant: Jermaine Grandberry v. Northwest Pallet Services

The defendant in the case is Northwest Pallet Services, LLC, a pallet recycling and distribution company. Grandberry claims the company actively retaliated against him after he reported workplace hazards (which is a legally protected activity).

History of the Case: Jermaine Grandberry v. Northwest Pallet Services, LLC

Grandberry allegedly reported unsafe workplace conditions (an action defined as a legally protected activity). According to the complaint, the company allegedly responded to his complaints with discriminatory treatment and retaliation, which led to his termination.

What is a Legally Protected Activity?

A legally protected activity for the purposes of labor law refers to an action taken by an employee to assert their rights or report potential violations of employment laws like discrimination, harassment, or retaliation. Actions taken to oppose discrimination include participating in a discrimination proceeding, seeking reasonable accommodations (based on disability or religious beliefs), reporting harassment or discrimination, etc.

The Main Question Being Considered in the Case:

The central issue in this case is whether Northwest Pallet Services terminated Grandberry because of his complaints. Doing so is an act of workplace retaliation in response to a protected workplace safety complaint and allegations of discrimination, thereby violating California labor laws and public policy.

Does This Case Matter to California Employees?

This case highlights California's robust legal protections for employees who report unsafe working conditions or discrimination on the job. Employers who retaliate against their workers when they make these types of reports could face significant legal liability that may come with hefty consequences. Employees should understand that retaliation for protected complaints is prohibited under California law.

FAQ: Jermaine Grandberry v. Northwest Pallet Services, LLC

Q: If a California employee reports unsafe working conditions, can they be fired?

A: No. Workplace retaliation in response to an employee reporting workplace safety concerns in good faith is prohibited under the California Labor Code.

Q: What laws protect California employees from retaliation?

A: California Labor Code §§ 1102.5 and 6310 protect employees from retaliation after they have submitted workplace safety or discrimination complaints.

Q: Does wrongful termination include retaliation claims?

A: Yes. If an employee is terminated due to protected complaints, it can constitute wrongful termination, and both violations can be included in the complaint.

Q: How soon should an employee act after being wrongfully terminated?

A: As quickly as possible as there are strict deadlines for filing claims under California law.

If you believe you've been wrongfully terminated or retaliated against after reporting unsafe working conditions or discrimination, our legal team can help. Contact Blumenthal Nordrehaug Bhowmik DeBlouw LLP today. Our experienced Los Angeles employment law attorneys fight to protect the rights of workers across California, with offices serving clients in Los Angeles, San Diego, San Francisco, Sacramento, Riverside, and Chicago.

Hearn v. PG&E: What California Employees Need to Know About Defamation Claims After Termination

When you’re fired from a job (especially if you believe it was wrongful), your first instinct might be to protect your reputation as well as your livelihood. Sometimes that means filing both a wrongful termination claim and a defamation claim. But a recent California Court of Appeals decision, Hearn v. Pacific Gas & Electric Co., shows why that strategy can be tricky.

The court made it clear: If your defamation claim is based on the same conduct that led to your termination, you likely won’t be able to recover damages for it.

Case: Hearn v. Pac. Gas & Elec. Co

Court: Court of Appeal, California, First Appellate District Division Three

Case No.: A167742, A167991

Hearn v. Pac. Gas & Elec. Co: A Brief History of the Case

Todd Hearn, a PG&E lineman, was suspended and later terminated after an internal investigation found discrepancies in his time records. The investigation included witness statements and GPS data.

Hearn sued PG&E, claiming:

• Retaliation for reporting safety violations (Labor Code § 1102.5)

• Retaliation for reporting unsafe working conditions (Labor Code § 6310)

• Wrongful termination in violation of public policy

• Defamation

By the time the case reached trial, only the retaliation claim under § 1102.5 and the defamation claim remained. The jury sided with PG&E on retaliation but awarded Hearn damages for defamation. PG&E appealed.

The Court’s Decision: Hearn v. Pac. Gas & Elec. Co

The California Court of Appeals reversed the defamation award, holding:

Defamation claims must be separate from termination conduct. If the alleged defamatory statements are part of the firing process—such as in investigative reports—they cannot be the basis for separate damages.

Damages must be distinct from job loss. You can’t recover reputational damages if they’re tied only to losing your job, without evidence of broader harm to your reputation outside the termination.

In Hearn’s case, the allegedly defamatory statements were made in the course of PG&E’s internal investigation and were directly tied to the termination decision, meaning the defamation claim couldn’t stand.

What California Workers Should Know About Hearn v. Pac. Gas & Elec.

If you’ve been wrongfully terminated, you may also feel your employer made false statements about you. But this ruling shows that when those statements are part of the termination process itself, your ability to claim separate defamation damages is limited.

Key points to remember: Wrongful Termination & Defamation Claims

Separate the issues. If you believe you were defamed, document instances where false statements were made outside of formal HR or disciplinary processes, especially if they were shared with people who did not need to know.

Look for harm beyond job loss. Rather than focus solely on the termination itself, you need to demonstrate specific reputational damages and lost job opportunities caused by the defamatory statements.

Act quickly. California’s statute of limitations for defamation is generally one year from the date the statement was made.

FAQ for Wrongfully Terminated Employees:

Q: Can I still sue for defamation if my employer made false statements during my firing?

A: Yes, but only if you can prove the statements went beyond what was necessary for the termination process and caused separate harm to your reputation.

Q: What kind of evidence helps in a defamation claim?

A: Copies of emails, written statements, or testimony from people who heard the false statements—especially if they were made outside HR or to people unrelated to your termination.

Q: What should I do first if I think this happened to me?

A: Consult an experienced employment attorney right away. They can help determine if your defamation claim is distinct enough from your termination claim to be viable.

If you believe you’ve been wrongfully terminated and defamed in California, our legal team can help. Contact Blumenthal Nordrehaug Bhowmik DeBlouw LLP today. Our experienced Los Angeles employment law attorneys fight for California workers' rights, with offices serving clients in Los Angeles, San Diego, San Francisco, Sacramento, Riverside, and Chicago.

Arizona Drywall and Painting Companies Ordered to Pay $7.45 Million for Overtime Violations

Two Phoenix-area construction companies have been ordered to pay more than $7.4 million to cover back wages and damages. The order followed the U.S. Department of Labor investigation that uncovered a deliberate scheme to deny overtime pay to over 1,400 workers. The consent judgment in Julie Su v. Apodaca Wall Systems Inc., Empire Wall Systems Inc., et al marks one of the largest wage theft recoveries in Arizona’s construction industry in recent years.

Case: Su v. Apodaca Wall Systems Incorporated et al

Court: Arizona District Court

Case No.: 2:24-cv-03560

The Plaintiff: Su v. Apodaca Wall Systems Incorporated et al

The plaintiff in the case is Julie Su, Acting U.S. Secretary of Labor (on behalf of the U.S. Department of Labor’s Wage and Hour Division).

The Defendants: Su v. Apodaca Wall Systems Incorporated et al

1. Apodaca Wall Systems Inc. – Phoenix-based drywall and interior painting company.

2. Empire Wall Systems Inc. – Phoenix-based drywall and interior painting company.

3. Arnold Apodaca – Owner.

4. Michael Apodaca – Owner’s son and co-owner.

5. Brittany Apodaca – Owner’s daughter and co-owner.

History of the Case: Su v. Apodaca Wall Systems Incorporated et al

According to the Department of Labor, Apodaca Wall Systems and Empire Wall Systems willfully violated the Fair Labor Standards Act (FLSA) by using multiple schemes to avoid paying employees legally required overtime wages:

• Paying hourly workers with multiple checks at straight-time rates for all hours worked.

• Using labor brokers that helped them hire hourly workers, they paid them in cash at straight time (even if they worked more than 40 hours a week).

• Paying piece rates (based on square footage completed) to off-the-books workers without regard for total hours worked. While crew leads received piece-rate pay, they redistributed it (denying overtime compensation)

According to the investigation, these unlawful practices impacted over 1,400 employees, many of whom were vulnerable workers relying on overtime wages to support themselves and their families. The U.S. District Court entered a consent judgment on January 15, 2025, that ordered:

1. An injunction that forbids future labor law violations

2. Back payment of overtime wage totaling $3,725,000

3. Payment of liquidated damages totaling $3,725,000

4. Civil penalties for willful FLSA violations totaling $125,000

The Main Question in the Case:

The main question the court has to consider in Su v. Apodaca Wall Systems is whether or not the defendants used illegal pay schemes to deny their employees earned overtime wages and intentionally violated federal overtime laws.

Why This Case Matters: Su v. Apodaca Wall Systems Incorporated et al

This case highlights the Department of Labor’s aggressive enforcement in Arizona’s construction sector. In the past five years, federal investigators have recovered over $22 million in unpaid wages and damages for employees across the state.

FAQ: Su v. Apodaca Wall Systems Incorporated et al

Q: What is the Fair Labor Standards Act (FLSA)?

A: The FLSA is a federal law requiring covered employers to pay eligible employees at least the federal minimum wage and overtime pay (time-and-a-half) for all hours worked over 40 in a workweek.

Q: How did the companies try to avoid paying overtime?

A: By splitting pay across multiple checks, paying in cash at straight-time rates, and misclassifying work as piece-rate to avoid tracking overtime hours.

Wage theft and overtime violations can have devastating effects on workers and their families. If you believe your employer's business practices violate labor law, Contact Blumenthal Nordrehaug Bhowmik DeBlouw LLP today. Our California employment law attorneys represent workers statewide, including Los Angeles, San Diego, San Francisco, Sacramento, and Riverside, and we fight to hold employers accountable for violating employee rights.

State Farm Faces Racial Discrimination Lawsuit from Former Attorney After Judge Sends Case Back to California State Court

A former State Farm litigation attorney has secured an early procedural win in her racial discrimination and retaliation lawsuit, as a federal judge sent the case back to California state court—widely seen as a more favorable venue for employees in workplace discrimination claims.

Case: Kymberly Aleem Duncan v. State Farm

Court: California Northern District Court

Case No.:3:24-cv-08528

The Plaintiff: Duncan v. State Farm

Kymberly Aleem Duncan, a former litigation attorney in State Farm’s Pleasanton, California office, alleges she was the only African-American woman among 21 attorneys in her department and endured a pattern of discrimination, retaliation, and harassment that ultimately forced her resignation in May 2023.

The Defendants: Duncan v. State Farm

State Farm Mutual Automobile Insurance Company – Duncan’s former employer.

Jeanette Nicole Little – Current managing attorney at State Farm’s Pleasanton office, and one of Duncan’s supervisors.

History of the Case: Duncan v. State Farm

According to Duncan, her troubles started under former managing attorney Philip Anderson. Anderson allegedly blocked Duncan's promotion in favor of a white male employee and later made comments suggesting he had become "more open" to hiring people of color.

When Little took over as managing attorney in 2021, Duncan alleges the discriminatory treatment intensified. Her lawsuit claims she was:

• Given less qualified support staff, which negatively affected her work performance.

• Assigned an unfairly heavy workload to set her up for poor reviews.

• Denied management training and promotional opportunities despite her qualifications.

• Labeled “abrupt and confrontational,” which she argues played into the “angry Black woman” stereotype.

• Deliberately excluded from workplace events, including a team lunch and a colleague’s funeral.

• Duncan alleges these actions created an intolerable work environment, amounting to a constructive discharge. She filed her lawsuit in Alameda County Superior Court in 2024, alleging racial discrimination, retaliation, hostile work environment, and failure to prevent discrimination under California’s Fair Employment and Housing Act (FEHA).

The Allegations: Sufficient to State a Harassment Claim?

State Farm moved the case to federal court, claiming that Little—a California resident—was fraudulently joined to block diversity jurisdiction. The company argued that Little’s conduct amounted to routine personnel management decisions, not harassment.

However, Judge Joseph C. Spero disagreed, finding Duncan’s allegations sufficient to state a harassment claim under California law. The judge ruled that the case should be heard in the California state court, as complete diversity did not exist.

Main Question in the Case: Duncan v. State Farm

Did State Farm and managing attorney Jeanette Nicole Little engage in racially discriminatory and retaliatory conduct that generated a hostile work environment?

FAQ: Duncan v. State Farm

Q: Why is the Duncan v. State Farm ruling significant?

A: By keeping the case in California state court, Duncan will pursue her claims in a venue generally viewed as more favorable to employees in discrimination cases.

Q: What does “fraudulent joinder” mean in connection to this lawsuit?

A: It’s when a defendant argues that another defendant was added to the lawsuit solely to defeat federal jurisdiction. The court rejected State Farm’s claim of fraudulent joinder in this case.

Q: What laws is the plaintiff suing under?

A: California’s Fair Employment and Housing Act (FEHA) prohibits workplace discrimination, harassment, and retaliation.

If you have faced workplace discrimination, retaliation, or harassment in California, you may have legal options under FEHA. Contact Blumenthal Nordrehaug Bhowmik DeBlouw LLP today. Our California employment law attorneys represent workers statewide, including Los Angeles, San Diego, San Francisco, Sacramento, and Riverside, and we fight to hold employers accountable for violating employee rights.

Los Angeles Nurse Sues Cedars-Sinai for Discrimination, Retaliation, and Wrongful Termination

A former Cedars-Sinai Medical Center nurse has filed a lawsuit claiming her dream nursing job turned into a nightmare when she faced repeated harassment from Filipino coworkers, discriminatory treatment, and ultimately termination after complaining about the abuse.

Case: Camyle Meier v. Cedars-Sinai Medical Center

Court: Los Angeles Superior Court

Case No.: 21STCV27139

The Plaintiff: Meier v. Cedars-Sinai Medical Center

Camyle Meier, a half-white and half-Japanese nurse, accepted her “dream job” at Cedars-Sinai shortly before finishing her bachelor’s degree in nursing. Inspired by childhood experiences (including her sister’s treatment at Cedars), Meier was eager to build a long career in medicine. According to her complaint, that goal was cut short due to a hostile work environment, discrimination, and retaliation.

The Defendant: Meier v. Cedars-Sinai Medical Center

Cedars-Sinai Medical Center is a large healthcare facility located in Los Angeles. It's also one of the largest employers in California’s medical sector.

History of the Case: Meier v. Cedars-Sinai Medical Center

Meier alleges that on her very first day of work, Filipino coworkers poured coffee into her backpack and tampered with her belongings, sending what she interpreted as a clear message of racial animus. Assigned to a section composed almost entirely of Filipino women who had worked together for over a decade, she claims she was consistently ostracized, bullied, and assigned the heaviest and most difficult patients without proper training.

The Allegations: Meier v. Cedars-Sinai Medical Center

According to the lawsuit, her colleagues filed falsified complaints against her, subjected her to unreasonable scrutiny, and undermined her work. Meier alleges that after she resisted actions she believed were unlawful and reported the harassment, retaliation escalated. She was placed on leave just two days before her six-month probationary period ended and was terminated for an alleged time recording violation—a policy she says was different from the one originally provided to her.

Meier's lawsuit includes claims for:

• Gender Discrimination

• Retaliation

• Breach of Contract

• Breach of the Covenant of Good Faith and Fair Dealing

• Failure to Prevent Harassment and Discrimination

• Failure to Take Corrective Action

• Intentional Infliction of Emotional Distress

The Main Question in the Case: Meier v. Cedars-Sinai Medical Center

Did Cedars-Sinai Medical Center violate California labor laws (including the Fair Employment and Housing Act (FEHA) by allowing a hostile work environment to develop, failing to take corrective action, and terminating Meier in retaliation for her complaints?

FAQ: Meier v. Cedars-Sinai Medical Center

Q: What type of discrimination is alleged in this case?

A: Meier claims she experienced race- and gender-based discrimination, harassment, and retaliation after reporting workplace misconduct.

Q: What specific conduct is alleged against her coworkers?

A: Allegations include tampering with personal belongings, pouring coffee into her backpack, assigning her the most physically demanding patients without training, filing false complaints, and subjecting her to ostracization and intimidation.

Q: What damages is the plaintiff seeking?

A: The lawsuit seeks unspecified compensatory and punitive damages for lost income, emotional distress, and harm to her professional career.

If you have been harassed, discriminated against, or wrongfully terminated in retaliation for speaking out, you may have legal options under California employment law. Contact Blumenthal Nordrehaug Bhowmik DeBlouw LLP today. Our experienced Los Angeles employment law attorneys fight to protect the rights of workers across California, with offices serving clients in Los Angeles, San Diego, San Francisco, Sacramento, Riverside, and Chicago.

L.A. County Nurse Reaches Tentative Settlement in Discrimination and Retaliation Lawsuit

A Los Angeles County registered nurse has reached a tentative settlement in her discrimination and retaliation lawsuit, in which she claimed she was repeatedly denied promotions and wage increases after speaking out about preferential treatment favoring Filipino and Asian-American nurses.

Case: Jessica Castillo v. Los Angeles County

Court: Los Angeles Superior Court

Case No.: 23STCV00176

The Plaintiff: Castillo v. Los Angeles County

Jessica Castillo, a registered nurse hired by Los Angeles County in September 2015, evaluated county hospitals and health facilities as part of her job. She alleges that beginning in late 2018, she and other non-Filipino nurses were subject to discriminatory work assignments and denied opportunities for promotion and higher pay after complaining about the treatment.

The Defendant: Castillo v. Los Angeles County

The defendant, Los Angeles County, is one of the largest public employers in California. The defendant denied Castillo’s claims. They claim that Castillo was promoted twice during her tenure, and received steady overtime. They also claimed that when Castillo was not selected for promotions, it was due to one of two valid reasons: 1) her own errors or 2) because other candidates were more qualified for the position.

History of the Case: Castillo v. Los Angeles County

Castillo’s complaint alleged that a program manager consistently gave more favorable assignments, telecommuting privileges, and overtime opportunities to Filipino and other Asian-American nurses, in violation of county rules and seniority rights. During the pandemic, favored employees were allegedly permitted to work remotely, while others (including Castillo) were required to work in the field. According to the plaintiff, the required field work allegedly exposed them to COVID-19. After complaining regarding the situation, Castillo claims she faced repeated denials of promotions until she was eventually transferred to another department in September 2021.

The Main Question to Consider in Castillo v. Los Angeles County:

The central question in this case is whether Los Angeles County unlawfully discriminated against and retaliated against Castillo in response to her complaints. Discrimination and retaliation in response to workplace complaints violates multiple labor laws as well as California’s Fair Employment and Housing Act (FEHA).

FAQ: Castillo v. Los Angeles County

Q: What type of discrimination did Castillo allege?

A: She claimed race and national origin discrimination, alleging that Latino, Black, and white nurses were treated less favorably than Filipino and Asian-American nurses.

Q: What retaliation did she claim?

A: Castillo alleged she was repeatedly denied promotions and pay increases after filing complaints about the alleged discriminatory treatment.

Q: Was the case resolved?

A: The parties have reached a conditional settlement, which is pending final approval by the Los Angeles County Board of Supervisors.

If you believe you have been denied promotions, pay increases, or other job opportunities due to discrimination or in retaliation for speaking out, you may have legal options. Contact Blumenthal Nordrehaug Bhowmik DeBlouw LLP today. Our experienced California employment law attorneys are ready to help protect your rights, with offices serving clients in Riverside, San Francisco, Sacramento, San Diego, Los Angeles, and Chicago.