FROM HIERARCHIES TO MARKETS: FEDEX DRIVERS AND THE WORK CONTRACT AS INSTITUTIONAL MARKER

Judges are often called upon today to determine whether certain workers are "employees" or "independent contractors. " The distinction is important, because only employees have rights under most statutes regulating work, including wage-and-hour and anti-discrimination laws. Too often judges exclude from statutory protection workers who resemble what scholars have described as "typical" employees-long-term, full-time workers with set wages and routinized responsibilities within a large firm. To explain how courts reach these counterintuitive results, this Article examines recent decisions finding that FedEx delivery drivers are independent contractors rather than employees. This Article finds that instability in the legal distinction between employees and independent contractors is embedded within the employment contract itself, in the law's attempt to construe the legal relations of master and servant as a "contract." By merging contractual formation and performance, this attempt creates two doctrinal ambiguities. By manipulating these ambiguities, the courts transformed some of the same vulnerabilities that place the drivers within the policy concerns of collective-bargaining and wage-and-hour law into evidence of their autonomy. The courts also attempted to reconcile the awkward fit of master-servant authority and contract by constructing the written contract that drivers sign as an institutional marker of non-employment. The attempt to encase master-servant authority in contract also destabilizes distinctions between firms and markets. The FedEx decisions marshal this instability to redefine a firm, as conceptualized by major economic theories of the firm, as a market. They conflate the depersonality of bureaucracy with the impersonality of the market. The drivers' fungibility as low-skilled workers performing standardized routines becomes evidence of their entrepreneurial opportunity, and the decisions submerged the FedEx bureaucracy beneath a nexus of contracts. The decisions reject theories of the firm that ground the legitimacy of the corporation in the production of goods and services. While we ultimately require a more radical transformation in work relations to prevent decision makers from redefining servitude as equality, this Article recommends two provisional suggestions to improve decision-making in disputes over employment status.