2004 xj8 fuel guage problem

When I fill up the car, the next day, have been getting a reading of empty, and the light comes on.  Drive for a bit, and the gauge goes all the way up.  Sometimes, when driving, the same thing happens. My dealer says it is the fuel pump which has a sending unit, and a seperate sending unit (which is called the jet pump assembly), and that either or both can be bad.  He wants to do both for a cost of $1,000 (2.25 hours labor), which sounds and will be really expensive. 
 
I read in the original motor trend and consumer reports test of this car that this was an issue on their test cars.  I just came out of warranty in December, only 22,000 miles on the car. 
 
Any suggestions, does this sound right?
 
Thanks  Mike

Sounds about right.  Can't really tell which or if both units have gone.  The pricing seems about right, too.

Sorry for the bad news.

they can diagnose which ones is faulty at the dealer.. but most people like to put in both.. due to them being so fragile. there made of plastic and dont relly last too long.. the terminals on the resistor part can get all rusty..  i usually charge 2 hrs including diag.. but 2.25 isnt that far off

Thanks for the help.  I called a second dealer in my area who said the time would be 2 hours for each unit, 4 hours labor, which would take me to $1,300.

4 hours is robbery.
You can tell if problem is sender or instrument pack.
Put keyin ignition, hold in trip button and start car, keep holding trip for 5 seconds and should say test mode on instrument pack.
Release trip button and with each press it will show different things on pack. Keep pressing until you see raw fuel 1. Once you see this keep driving until gauge drops. When dropped look at reading then press trip again. This will show raw fuel 2. A reading of 15 or 255 is the bad one. Raw 1 is right side raw 2 is left. If both readings stay normal, and gauge shows empty then your instrument pack is likely bad.

4 hours is crazy..warranty only pays like 1.3 or so for both