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Challenges ahead for FedEx

By Hpanchal on August 15, 2012

The U.S. Federal Aviation Administration has accused FedEx of violating U.S. Department of Transportation Hazardous Materials Regulations at facilities throughout the U.S. from Aug. 2, 2010 to Aug.12, 2010, an offense the agency deemed worthy of a $681,200 fine. FedEx has 30 days to respond to the FAA’s allegations.

According to the FAA, FedEx employees “improperly accepted” dozens of shipments containing hazardous materials for flight in August 2010. The agency discovered the safety breach after delving through records and inspecting FedEx facilities in or around Los Angeles.

The FAA also claims that, in 19 instances, FedEx didn’t provide pilots departing and arriving to Los Angeles with necessary “accurate and legible written information” about HAZMAT shipments the company accepted for flight. Further, the agency alleges that FedEx “failed to document hazardous materials training and testing” for three employees who accepted the parcels.

Michael Huerta, the acting administrator of the FAA, explained that this oversight could have adverse consequences. “To ensure the safe transport of hazardous materials aboard aircraft, operators must follow appropriate rules and procedures, and provide proper training,” he said in a statement.

This wasn’t the first time that the FAA accused FedEx of improperly handling hazardous goods, however. In July 2011, the FAA proposed a $689,800 fine against FedEx for breaching HAZMAT regulations at the company’s Bradley International Airport-based facility in 2009.

In another challenging turn for the company, FedEx officials have also decided to offer buyout incentives to U.S.-based, non-operational staff "in order to improve efficiencies and reduce costs," according to a company press release. Most of the cuts will come from the FedEx Express and FedEx Services divisions, but the company hasn't said how many employees will be impacted by the decision. Further details of the program will be announced in October.

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