For months, the House and Senate have been unable to reconcile the differences between their respective versions of legislation reauthorizing the Federal Aviation Administration (FAA). One key difference between the bills is that the House included a provision altering a bizarre inequity in labor law that allows FedEx to enact higher bars for unionization for its drivers than other shipping companies.

Currently, FedEx is governed by the Railway Labor Act (RLA), which only allows for national unions, as opposed to the National Labor Relations Act (NLRA), which allows for unionization at the local level. FedEx CEO Fred Smith — who was George W. Bush’s fraternity brother and has said “I don’t intend to recognize any unions at Federal Express” — has been loudly denouncing the House’s proposed change, which would pull FedEx under the NLRA.

FedEx spent $21.1 million in 15 months lobbying against it, more than Gulf oil spill culprit BP and defense contractor Lockheed Martin spent in the same period. And according to Congressional Quarterly, all that effort may be paying off for FedEx, as “Senate leaders are considering a ‘test vote’ this week on the House version of the legislation,” as a way of convincing the House that its bill is untenable:

The purpose would be to show the House that an FAA bill will not become law if it includes language that would make it easier for FedEx workers to unionize. According to Senate aides and lobbyists, the gambit would be intended to convince House Transportation and Infrastructure Chairman James L. Oberstar, D-Minn., that he must drop his insistence on retaining the contentious labor language.

FedEx has successfully lobbied multiple times to remain classified as an airline (and thus under the RLA), rather than having its ground operation indentified as what it really is. The company has also threatened to disrupt its own growth and scaremongered about medical supply deliveries being delayed if Congress makes the change. Of course, FedEx’s airline pilots have already unionized, without such dire consequences, while FedEx Ground’s drivers are subject to a law that makes it all but impossible to organize and collectively bargain.

Part of the problem in the Senate is that Tennessee’s two representatives — Sens. Bob Corker (R-TN) and Lamar Alexander (R-TN) — have threatened to filibuster a bill that includes the change, going to bat for the Nashville based FedEx. But the test vote ploy seems to imply that the Senate won’t even try to circumvent such obstruction, even though the change has Senate support. “I have said very clearly that I believe FedEx workers should have the same right to organize as UPS workers do,” said Sen. John Rockefeller (D-WV). “I am continuing to work with Democratic leadership to secure a strong vote on this issue.”

For his part, Oberstar seems unimpressed with the Senate’s idea. He remains “very determined to move this bill…and I cannot see him backing off,” spokesman Jim Berard said, adding that Oberstar recently said that “the House will not be deterred by threats from the Senate.”

Currently, House and Senate negotiators are trying to work out the differences between each chamber’s respective bill reauthorizing the Federal Aviation Administration. One key difference between the bills is that the House version corrects an inequity in labor law that allows Federal Express to operate under the Railway Labor Act (RLA), which poses higher barriers to union organizing than the National Labor Relations Act (NLRA). FedEx’s competitors, such as the United Parcel Service, are governed by the NLRA. The Senate bill does not contain the change.

FedEx has been waging an intense campaign in order to preserve its special treatment, led by CEO Fred Smith, who was George W. Bush’s fraternity brother and has said that “I don’t intend to recognize any unions at Federal Express.” And according to Roll Call, in 15 months the company spent $21.1 million lobbying Congress:

Last year, it ranked 14th among all groups and companies in lobbying budgets, spending more than oil giant BP and defense contractor Lockheed Martin. The Memphis-based company also has tapped politically connected assistance, contracting with 14 outside lobbying firms that employ a number of former Senators. Not only is the Breaux Lott Leadership Group working for FedEx, but its founders, former Sen. John Breaux (D-La.) and former Senate Majority Leader Trent Lott (R-Miss.), are listed on the lobbying disclosure forms as personally working on the account. FedEx hired the international public relations firm Burson-Marsteller to work specifically on this issue.

FedEx has successfully lobbied multiple times to remain classified as an airline (and thus under the RLA), rather than having its ground operation qualified as such, pulling it under the NLRA. This time around, it has threatened to blunt its own growth and scaremongered about medical supply deliveries being delayed if the change in labor law is made.

Tennessee’s two Republican senators, Lamar Alexander and Bob Corker, have also pledged to defeat the change. But there’s simply no reason for this inequity to remain law. FedEx’s pilots have already unionized, without the dire consequences that Smith warned about. And in the meantime, FedEx’s drivers are subject to a law that makes it all but impossible to organize and collectively bargain, as they would have to unionize literally the entire company (across the entire country), instead of being allowed to organize at the local level.

Last week, the National Mediation Board — which oversees labor-management relations under the RLA — did away with one inequitable aspect of the antiquated RLA, ensuring that uncast votes in union elections no longer count as votes against the union. Congress would do well to keep the ball rolling, enacting the change taking away the unjustified competitive advantage that FedEx now enjoys.

Today, the Senate is debating a bill reauthorizing the Federal Aviation Administration (FAA) that had earlier been subjected to a hold by Sen. Bob Corker (R-TN). The FAA reauthoritzation passed by the House last year includes a change in labor law that would remove barriers to unionization for truck drivers at Memphis-based FedEx, and Corker wanted an assurance from Senate Majority Leader Harry Reid (D-NV) that the change would not be included in the final bill (since it is already not included in the Senate language).

Currently, FedEx is governed by the Railway Labor Act (RLA), which does not allow for the formation of local unions, while the change would pull FedEx under the National Labor Relation Act (NLRA) along with other shipping companies like UPS. Reid reportedly promised to keep the language out of the Senate bill, which was enough for Corker to release his hold.

However, it doesn’t seem like the House is prepared to let the case drop. And FedEx CEO Fred Smith — who was George W. Bush’s fraternity brother and has said that “I don’t intend to recognize any unions at Federal Express” — is not taking any chances. He is “lobbying fiercely” today against the change, claiming that allowing FedEx drivers to unionize means medical supplies won’t get delivered on time:

Smith warned that if the measure becomes law, the Memphis, Tenn.-based company would slow its growth — in part by immediately canceling an order of 15 Boeing jets valued in the billions of dollars. It would also cut back significantly in its $2 billion in annual capital expenditures, he said…Smith said FedEx Express depends on the Railway Labor Act for reliability and security. Because the act requires federal government permission for strikes, it allows FedEx Express to avoid local work stoppages — strikes that Smith said could delay shipments of urgent goods such as medical equipment.

Smith added that he “feels confident his company’s supporters could block the bill if it included the labor language the House adopted.”

These are some classic threats that Smith is throwing out: canceled work orders and delayed medical shipments! How terrible! But back in reality, it’s pretty clear that Smith is using exaggerated rhetoric to protect his company’s ability to deny its workers collective bargaining rights.

For starters, I’m not sure who Smith thinks he’s threatening when he says his company will stop trying to grow. That seems like cutting off his nose to spite his face, and presumably it would give his competitors a chance to seize market share. As for the charge about medical supplies, Smith doesn’t seem to have the same concern about his 4,500 already-unionized pilots shutting down everything.

The simple fact remains that current law gives FedEx an unfair advantage and keeps its drivers — who are already systematically misclassified as independent contractors so that FedEx doesn’t have to pay them benefits — from exercising their right to collectively bargain.

Last year, the House of Representatives passed a bill reauthorizing the Federal Aviation Administration and devoting $70 billion to airport infrastructure through 2012. The bill also changed an inequity in labor law which has allowed FedEx to operate under the Railway Labor Act (RLA), while other shipping companies like UPS are governed by the National Labor Relations Act (NLRA).

The RLA poses larger barriers to organizing than the NLRA, which has enabled FedEx to prevent its drivers from collectively bargaining. So the company has invested a lot of time and effort into blocking the change, including characterizing it as a “bailout” for UPS.

And FedEx has an ally in Sen. Bob Corker (R-TN), who is preventing the FAA reauthorization from moving in the Senate, until he receives assurance that the change in labor law won’t occur:

Corker’s action extends a years-long fight in Washington between the mostly non-union FedEx and its unionized rival United Parcel Service Inc. over how workers at both companies should be treated under U.S. labor laws. “We are supportive of the Senate FAA bill, but we have placed a hold until we can be assured that the controversial FedEx provision will not be included in the final legislation,” Laura Lefler Herzog, a spokeswoman for Corker, a Republican, said today in an e-mailed statement.

The Senate’s version of the FAA bill doesn’t actually include the change, but Corker wants to ensure that it isn’t added when the Senate bill is reconciled with the House version. Sen. Lamar Alexander (R-TN) has also expressed his disapproval of the legislation. Both of these senators are invested in this issue because FedEx has its headquarters in Memphis, Tennessee.

While Corker, Alexander, and FedEx itself characterize the change as “singling out” FedEx, all it would do is level the playing field between FedEx and other shipping companies when it comes to unionizing. FedEx CEO Fed Smith — “who raised more than $100,000 for 2008 Republican presidential nominee John McCain and was George W. Bush’s fraternity brother” — has said that “I don’t intend to recognize any unions at Federal Express,” and the company successfully lobbied Congress in 1996 to keep its RLA status.

Not only does FedEx prevent unionization by keeping its status as an RLA-covered company, but it also systematically misclassifies its drivers as contractors (instead of full employees) so that they can’t organize. As American Rights at Work has pointed out, “by classifying nearly 15,000 drivers as independent contractors rather than employees, FedEx Ground lowers its labor costs by avoiding payroll taxes and benefits.” Its drivers are responsible for fuel and maintenance of the trucks, and are not provided with paid vacation or sick leave.

UPS spokesman Malcolm Berkley said that the change should be made because “we believe all drivers in the country, who are doing the same job, should be treated by the same law. To us, it is literally that simple.” But Corker’s obstinance is preventing that from happening.

Currently, due to a legal loophole, Federal Express is allowed to operate under the Railway Labor Act, instead of the National Labor Relations Act (NLRA) that governs other companies like UPS. And as the Washington Times reported today, there is a battle brewing between FedEx and UPS, while Congress considers a change that would pull FedEx under the NLRA.

The Railway Labor Act “poses huge barriers to organizing” compared to the NLRA, and thus FedEx is not very pleased about the prospect of a change:

“We are an airline; [UPS] are a trucking outfit,” said FedEx spokesman Maury Lane. “You can’t put stop signs at 30,000 feet.”

But this is about more than just unionization. FedEx’s resistance to the change is consistent with its strategy of doing all that it can to avoid treating its drivers fairly.

For instance, FedEx constantly misclassifies its drivers as independent contractors, placing them outside of the protection of most labor and employment laws. As American Rights at Work pointed out, “by classifying nearly 15,000 drivers as independent contractors rather than employees, FedEx Ground lowers its labor costs by avoiding payroll taxes and benefits.” Its drivers are responsible for fuel and maintenance of the trucks, and are not provided with paid vacation or sick leave.

Misclassification can ultimately save employers “upwards of 30% of their payroll costs.” And because the drivers are not technically employees, they are barred from unionizing.

FedEx claims that its model “works for the company, the contractors and the customers.” But last week, U.S. District Judge Robert Miller granted a request to bring a class action suit against FedEx, by drivers “who claim they deserve benefits because the company treats them as full-time workers by mandating their clothing, hours and prices.”

In a previous ruling in a similar case, the California Superior Court decided that FedEx drivers were indeed full employees, and that FedEx’s driver agreements constitute “a brilliantly drafted contract creating the constraints of an employment relationship…in the guise of an independent contractor model.” So FedEx needs to do much better than cry “we are an airline” (whose pilots, incidentally, are represented by the Airline Pilots Association) to justify its treatment of its drivers and its resistance to fair labor law.