## Facts

- FedEx Ground used a standard Operating Agreement and related policies to govern pickup-and-delivery drivers’ routes, appearance, equipment, procedures, and performance expectations.
- Carlene M. Craig and a certified Kansas class of 479 current and former FedEx Ground drivers alleged FedEx misclassified them as independent contractors rather than employees.
- The Kansas class asserted claims under the Kansas Wage Payment Act (KWPA), seeking repayment of work-related costs and expenses they paid and wages allegedly due as employees.
- The litigation was part of a multidistrict proceeding in the Northern District of Indiana involving many similar driver-misclassification cases.
- On cross-motions for summary judgment, the district court held the Kansas drivers were independent contractors under the KWPA on the stipulated, undisputed record and entered judgment for FedEx.
- The Kansas class appealed; the employee-status issue under Kansas law was dispositive of the KWPA claims.

## Issues

1. On the undisputed record, are FedEx Ground’s Kansas pickup-and-delivery drivers employees, as a matter of Kansas law, under the KWPA?
2. If some drivers acquired more than one service area (route), does that change the employee-status analysis under the KWPA?

## Decision

- The Seventh Circuit stayed the appeal and certified both questions to the Kansas Supreme Court under Kansas’s certification procedure.
- The Seventh Circuit determined that an authoritative state-law ruling would be dispositive of the Kansas class’s KWPA claims and would aid resolution of related cases in the MDL.
- The Kansas Supreme Court later answered that, on the undisputed facts, the drivers were employees as a matter of law under the KWPA and that acquiring additional routes did not change employee status.
- The Kansas Supreme Court’s answer rejected the district court’s independent-contractor ruling on the Kansas class’s KWPA claims.

## Legal Principles

- When state law is unsettled on a dispositive issue in federal litigation, a federal appellate court may certify questions to the state’s highest court to obtain an authoritative interpretation.
- Under Kansas law applied to the KWPA, employee status turns primarily on the putative employer’s right to control the manner and means of the work, assessed through multiple common-law factors.
- Contractual labels describing a worker as an “independent contractor” do not control if the agreement and actual retained rights reflect employer control.
- A worker’s acquisition of additional routes or use of helpers does not, by itself, defeat employee status when the company retains overarching control over essential work terms and integration into the business.

## Conclusion

The Seventh Circuit did not decide the Kansas drivers’ KWPA employee status on the merits in 2012; instead, it certified dispositive employment-status questions to the Kansas Supreme Court, which later held the drivers were KWPA employees as a matter of law, including those with multiple routes.


Craig v. FedEx Ground Package Sys., Inc., 686 F.3d 423 (7th Cir. 2012)