FedEx has agreed to a roughly $228 million settlement over a lawsuit alleging the company misclassified more than 2,000 California drivers as independent contractors and thus owes them overtime pay and other benefits.

FedEx originally prevailed in a federal court proceeding, which ruled that the company was not subject to California labor laws. An appeals court, however, overturned that decision.

FedEx then appealed to the 9th U.S. Circuit Court of Appeals in San Francisco, but before the issue could come to trial, both sides agreed to a settlement totaling some $228 million for the workers at FedEx Ground Package Systems, covering the period between 2000 and 2007.

FedEx confirmed that the branch in question is no longer operating.

If you own or operate a small to medium-sized business, managing all your employees plus meeting federal labor laws and regulations can be daunting, especially with new rules being issued all the time. To help you understand your rights and responsibilities in every facet of running a business, please order a copy of Personnel Concepts’ All-On-One HR Compliance Program for Small Businesses.