FedEx Ground head faces contractor group's no-confidence vote

A Federal Express truck on delivery is pictured in downtown Los Angeles
A Federal Express truck on delivery is pictured in downtown Los Angeles, California October 29, 2014. REUTERS/Mike Blake

Sept 6 (Reuters) - A former FedEx Corp (FDX.N) delivery contractor on Tuesday called for a no-confidence vote by contractors against FedEx Ground Chief Executive John Smith, escalating a conflict with the parcel delivery firm.

The vote is scheduled to start on Tuesday and will end on Friday, Spencer Patton, president of the Trade Association for Logistics Professionals (TALP), said in a statement. Patton launched the group last month to advocate for contractors. read more

Last month, Patton ratcheted up pressure on FedEx to boost compensation for contractors after company actions made it even harder for them to wring out a profit in a downshifting, inflationary economy.

FedEx, in response, filed a suit against the contractor and severed ties with him. In its lawsuit, the company alleged that Patton was disparaging its Ground business through a series of false and misleading statements about its commercial activities. read more

Patton, who was one of the largest delivery contractors for FedEx, said contractors would be asked to anonymously answer a couple of questions and the data will be reviewed by an independent global advisory firm.

"Under Smith's leadership, small business owners operating FedEx Ground's network have been increasingly burdened by extreme inflation costs and forced contract changes," Patton said.

More than one-third of the small business contractor network has already, or will soon need to, walk away from their FedEx Ground contract as high costs squeeze profit margins, TALP said, without providing details.

When asked for comment, FedEx did not directly address the vote but said the company was committed to creating opportunities for service providers to thrive in a competitive market.

"Through this, we have and will continue to engage service providers, recognizing each of these businesses is unique and managing through these conditions differently," FedEx said in an emailed statement.

Reporting by Aishwarya Nair in Bengaluru; Additional reporting by Priyamvada C; Editing by Maju Samuel

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