UPS Strike

A tentative agreement on a new contract between UPS and the Teamsters has been struck, possibly preventing a walkout. A labor ups strike that would have paralyzed US supply lines and cost the economy billions of dollars might have started as early as next week.

UPS Strike

About UPS and Teamsters

Sean O’Brien, president of the Teamsters, said in a statement: “We’ve changed the game, fighting it out day and night to make sure our members won an agreement that pays strong compensation, recognizes their work, and doesn’t call for any concessions. “This contract sets a new standard for the labor movement and raises the bar for all workers.”

The agreement comes at a time when the labor movement in America has become more energised and powerful. For the first time in decades, the pandemic caused lower- and middle-class US employees’ wages to soar, but contract workers were mostly excluded from these gains. Because of this, unionized nurses, teachers, actors, writers, and UPS employees have lately gone on strike, and autoworkers and nurses have vowed to do the same.

CEO of UPS Carol Tomé stated in the statement, “Together we achieved a win-win-win agreement on the themes that are important to Teamsters leadership, our employees, as well as UPS and our customers.With this agreement, we can continue to offer UPS’s full-time and part-time employees market-beating compensation and benefits while maintaining the flexibility we need to remain competitive, service our customers, and grow our business.

To completely avert a walkout, the tentative accord must still be approved by 340,000 Teamsters at UPS. It will take a little over three weeks to complete that ratification process. A membership vote in favor of a strike would still be possible, but it would now happen in late August rather than on the scheduled strike date of August 1.

Part-time UPS employee Ryan Boyd expressed his optimism on Tuesday at a Teamsters union hall in Philadelphia. “It’s very hopeful,” he remarked. If the tentative agreement is in line with the terms The Teamsters have outlined over the past few months, then I believe this is going to be a truly historic agreement that is beneficial not only for UPS workers but for workers in the sector as a whole.While FedEx, the US Postal Service, and Amazon’s own delivery service had some surplus capacity, few people believed they could handle all the goods in the event of a strike given that UPS delivered an average of 20.8 million parcels per day last year.

The provisional deal was lauded by President Joe Biden. In a statement, he praised the agreement as a clear example of how employers and employees can join forces at the negotiating table to resolve their disagreements in a manner that promotes business success. while helping workers secure pay and benefits they can afford to raise a family on and retire with dignity and respect.”

Julie Su, the acting labor secretary, stated to CNN on Tuesday that the Biden administration did not become involved in or support labor.

Su told Boris Sanchez in an interview from the White House, “No, the parties make this agreement on their own- and I think that’s an important thing.”

Air conditioning for delivery vehicles, demands for significantly higher pay, particularly for part-time workers, and the bridging of pay discrepancies between two different classes of UPS workers were among the problems in the contract negotiations.

UPS Strike

contract discussions

According to O’Brien, the two parties had previously agreed on around 95% of the deal, but on July 5 the negotiations stalled due to financial concerns. Tuesday’s negotiations were centered on compensation and benefits for part-time employees, who make up more than half of the Teamsters employed by the company. Tuesday morning when the discussions picked back up, the provisional deal was soon struck.

The draft agreement’s many elements have not yet been made public. However, according to the union, current full- and part-time UPS Teamsters will receive $2.75 more per hour in 2023 and $7.50 more per hour, or more than $15,000 per year, throughout the course of the deal.

The starting wage for current part-time employees, which the union claimed was as low as $15.50 per hour in some regions of the nation, will be increased to no less than $21 per hour immediately and will reach $23 per hour throughout the course of the contract.

The corporation said that before this contract, part-timers were already making more than $20 per hour on average and that they received many perks that most other part-timers do not, such as tuition reimbursement, premium-free health insurance, and pensions.

Even a brief strike could result in long-term client loss for the business because many major shippers might have committed to long-term contracts with UPS rivals like FedEx to keep their shipments moving. UPS might only recoup 70% of its typical revenue, according to Satish Jindel, president of ShipMatrix, a software company that works with parcel transporters.

 UPS strike might still occur near future

But the possibility of a UPS strike still exists. Many Teamsters still harbor unresolved resentment, and despite wage raises and other concessions made at the negotiation table, the membership might still reject this agreement.

Todd Vachon, a professor of labor studies at Rutgers University, stated that the company’s soaring earnings during the epidemic were a result of the work of its employees who put in a lot of required overtime. “There’s a lot of frustration, and I’m not sure they’re going to ratify a contract on the first round, regardless of what’s in it.”

Some members will likely be relieved at not having to go on strike. UPS strike have not seen since 1997, the majority of the 340,000 Teamsters employed by the firm have never participated in one.

A UPS driver named Carl Morton expressed his excitement over the news of the agreement, saying he was prepared to ups strike and walk off the job if necessary but hoped it wouldn’t.

At the union hall in Philadelphia, he told that “it’s like an instant relief.” It’s absurd. We had just moments ago believed he was going on ups strike, but everything is now basically sorted.

Nevertheless, ratification votes have frequently failed despite the agreement being supported by union leadership in many cases.

One such vote took place this week when 57% of the FedEx pilots’ union members rejected a provisional contract agreement that would have increased their compensation by 30%. Despite the no vote, that union is not permitted to go on ups strike anytime soon due to the labor laws that apply to airline pilots.

The Teamsters at UPS, however, are exempt from these restrictions. Additionally, despite the fact that their union leadership supported profitable accords, they haven’t applied to other unions whose rank-and-file members went on strike.

John Deere employees who belong to the United Auto Workers union rejected a contract in October 2021 and went on strike. They later rejected another offer and continued to strike before finally agreeing to a third one to conclude the five-week walkout. And even though the same restrictions that applied to FedEx pilots barred them from going on strike, many of the freight railroad unions rejected agreements that their union leadership had made the previous year.

A majority of Teamsters decided not to ratify the current contract with UPS in 2018, which for the first time had the two-tier pay system. However, because a large enough portion of the union did not take part in the ratification vote, the contract was nonetheless imposed on them, which infuriated the members. Since then, the Teamsters have altered the law such that a “no” vote in the ratification process now results in a ups strike, regardless of the number of participants.

In his election campaign, O’Brien made his resistance to the contract the central issue. O’Brien expressed his confidence in the ratification of a tentative union agreement to CNN earlier this year. However, he claimed that UPS is the target of the members’ ire, in part because several other businesses—including non-union FedEx—increased worker compensation during the pandemic.

“There is a lot of anger and animosity, not just about the last contract but also about what happened during the pandemic,” O’Brien told CNN in June. “UPS wasn’t paid even though they made record profits,”

UPS reported 2022 profits of $11.3 billion, nearly doubling to recurrent record levels under the current five-year contract thanks to a spike in online buying during the epidemic.

The Teamsters said that during the course of the contract’s five-year term, the deal will cost UPS an additional $30 billion in spending. UPS declined to comment on that number, but it stated that when it released second quarter earnings on August 8, it will provide details of its own estimate of the cost.


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