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Originally Posted by NYCfixie
You are splitting hairs over the phrases "independent contractor" and "independent businesses" and who actually owns the truck/route versus if the employee/driver is the owner or just a paid hourly driver. Too many combinations to list so I oversimplified and made the point that the drivers are not employees and do not get compensated like employees.
As you may or may not know, FedEx purchased Roadway Package Systems years ago and re-branded as FedEx Ground and Home Delivery. They kept the contractor structure as a cost management measure. Why have more employees which cost more when you can have contractors which cost less because the cost can be managed and you do not have to deal with employee unions.
While I am no expert on this subject, within the past 12 months I had to write a 25 page paper comparing the enterprise risk management plans/policies of UPS and FedEx. One of the major points was how FedEx better controls human resource costs by using independent contractors but that also creates risk because these people do not feel connected to the company as much as full time employees and thus may not treat the packages with as much care.
As to Amazon, there are so many YouTube videos and articles stating how being an Amazon contracted driver is a miserable job and often you make less than minimum wage.
IMHO, the drivers who are not direct employees of Amazon or FedEx are treated poorly and get paid very very low wages compared to their full time employee colleagues.
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No expert either, although my father worked in distribution/trucking for 50 years in the Rocky Mountain region. Mostly sales and business development for companies that were ultimately gobbled up by national companies. Early in his career he was sent to UT to expand business for a CO company he worked for. He ran into Mormons who wouldn’t do business with him and a growing regional service that would take small shipments and not full trailer loads. Was revolutionary at the time. That business grew to be the UPS we know today. The last 20 years my father started his own freight and warehouse services and ran it soup to nuts - much the same as FedEx route owners but he had to secure the business in addition to running operations, staffing drivers, etc. Tough competitive business.
Pressure on cost cutting will eventually hit UPS as well. Everyone wants cheaper and it usually comes from cutting the middleman.