March 12, 2014
The success of FedEx Ground has intrigued analysts and workplace trend watchers. They see the use of contract drivers by FedEx Ground, a division of FedEx Corp., as a way for the company to cut costs and use that competitive edge to win market share from rival UPS. Critics, meanwhile, wonder if the contractor model is a formula for long-term success or simply a cost cutting gimmick that provides a short-term advantage that can spur immediate and rapid growth but can’t sustain it. The independent-contractor method also raises questions about the role of corporations in protecting workers by contributing to health insurance, pensions, unemployment insurance and all the other elements of the safety net on which many American workers rely.