Congratulations! We Passed AB 701: The Warehouse Workers Protection Act

 Hello,

Yesterday, we had the honor of joining Governor Newsom, Assemblywoman Lorena Gonzalez, Senator Maria Elena Durazo, and leaders from all across our state in celebrating the signing of California’s nation-leading worker protection laws, including our policy, AB 701.

AB 701, the Warehouse Workers Protection Act, is the first of its kind and an initial step in addressing the reality of algorithmic work in our country. It will protect the over 250,000 frontline warehouse workers in California by requiring employers to disclose quotas while prohibiting them from penalizing workers for rest periods, bathroom breaks, and time complying with health and safety laws.

Just as important as the policy, is the reason we took on this fight. The Los Angeles Labor Movement, and our partners across the Greater Los Angeles Area, had a front-row seat to the growing warehouse industry and the unchecked influence that corporate giants, such as Walmart and Amazon, have on our communities.

Los Angeles is uniquely positioned in the global supply chain and integral to the movement of goods in the United States. Our ports are the busiest in the country with over 40% of all containers in the US coming through our shores. Our robust freeway and rail systems create the ideal infrastructure for the movement of these goods, goods that touch every single state in the US. The sheer size of the population of Los Angeles creates one of the largest markets in the country, incentivizing retail companies to create distribution centers and resulting in the Greater Los Angeles Area having the most warehouses in the country. Combined with our ever-growing dependence on e-commerce, especially during the pandemic, we are left with an ever-expanding workforce composed predominantly of workers of color.  

Over the last few years, we have heard from countless workers who told stories of dangerous working conditions and inhumane quotas resulting in debilitating injuries. Young workers, many of them heads of their households, were forced to twist, bend, and eventually break their bodies to meet the rising demand. It was clear to us that something had to be done and that Los Angeles was destined to take on the warehousing industry head-on.

We would like to thank Gov. Newsom for signing the Warehouse Workers Protection Act and standing with warehouse workers, and Assemblymember Lorena Gonzalez for championing the bill. Her valiant efforts and steadfast determination made this historic policy a reality. Thank you to our partners, such as the Teamsters, the Warehouse Workers Resource Center, and LAANE, for helping us pass such an innovative policy that will protect workers into the future.  

This is a victory for every worker who spoke up, engaged their representative, or joined one of our actions. We are proud to say that California stands firmly in its values and will continue to say, “Work shouldn’t hurt!”

In Solidarity,

Ron Herrera

President, Los Angeles County Federation of Labor, AFL-CIO

GREED

 September 3, 20219:45 AM PDTLast Updated an hour ago

Business

EXCLUSIVE FedEx faces labor union challenge over billionaire CEO's pay

By Jessica Dinapoli

3 minute read

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Fedex CEO Fred Smith is pictured at a business roundtable meeting of company leaders and U.S. Republican Presidential candidate Mitt Romney in Washington, June 13, 2012. REUTERS/Jason Reed

Sept 3 (Reuters) - FedEx Corp (FDX.N) shareholders should reject founder and CEO Fred Smith's $54 million pay package because the logistics company gave him stock options after scrapping a cash bonus in the wake of the COVID-19 pandemic, only to reinstate it later, the Teamsters labor union said on Friday.

Smith, whose net worth is pegged by Forbes at $5.8 billion, was given a special option award "for motivation and retention purposes" in June 2020 after FedEx canceled a $3.4 million cash bonus for him, citing uncertainty around the COVID-19 pandemic.

Those options were worth $6.4 million as of the end of May, the close of FedEx's fiscal year, more than doubling in value since Smith received them. As more people shipped and received items during the pandemic and FedEx's business rebounded, the Memphis, Tennessee-based company reinstated Smith's $3.4 million cash bonus in December, but also allowed him to keep the special stock options.

This amounted to "double-dipping" that undercuts the pay-for-performance structure of Smith's compensation, the International Brotherhood of Teamsters, which is bargaining on behalf of FedEx employees at a freight facility and is an investor in FedEx through pension and benefit funds, argued in a letter to shareholders on Friday, which was seen by Reuters.

"Having founded the company, been chief executive since 1998 and holding an 8% equity stake, surely CEO Smith has the appropriate incentives to drive shareholder value," the Teamsters general secretary-treasurer, Ken Hall, wrote in the letter.

The union is urging shareholders to vote against the company's executive pay plan at the company's annual meeting on Sept. 27. As with most companies, the vote at FedEx is non-binding.

FedEx declined to comment beyond what it has disclosed on executive pay in securities filings. In its informational disclosure to investors, FedEx said a significant portion of executive compensation is "at risk" and dependent on the company hitting performance goals and share price targets.

FedEx Chief Operating Officer Rajesh Subramaniam, the company's highest paid executive after Smith, also had his $2 million cash bonus reinstated after he received a similar special option award and stock grant worth approximately $6 million at the end of May.

Many U.S. companies tweaked the pay of executives during the pandemic, easing performance targets and even giving them pay rises. Investors then voted down a record number of CEO pay packages at their annual shareholder meetings earlier this year. L2N2NL2O2

Although most shareholder votes on pay are non-binding, some companies have tweaked executive pay when faced with investor opposition. For example, in 2018 Walt Disney Co (DIS.N) renegotiated the compensation of its chief executive at the time, Bob Iger, to toughen performance targets after shareholders voted down his pay.

The Teamsters acknowledged in the letter that Smith's options had yet to vest and that there was still uncertainty over the value of that grant. Smith also accepted a 91% cut in his annual salary during some of the last fiscal year. His salary was $966,125.

Reporting by Jessica DiNapoli in New York Editing by Greg Roumeliotis and Leslie Adler

Our Standards: The Thomson Reuters Trust Principles.

XPO to stop hauling inbound LTL traffic to Amazon locations

Move, effective Monday, seen as reaction to Amazon diverting too much of XPO’s trailer capacity

 Mark Solomon

20 hours ago

As of Monday, XPO Logistics Inc. will no longer accept inbound LTL shipments destined for Amazon.com Inc. warehouses, XPO said Friday.

In a memo obtained by FreightWaves, XPO instructed its employees to stop directing “Amazon-routed freight” through the carrier’s LTL network. The memo came from Mario A. Garza, XPO’s (NYSE:XPO) LTL national 3PL account executive, a sign that XPO’s action is directed at third-party logistics providers that consolidate shipper traffic and tender it to XPO for delivery to Amazon’s (NASDAQ:AMZN) warehouses.

The XPO decision affects the “middle-mile” of Amazon’s transportation infrastructure, where goods move from supplier facilities to an intermediate point to await outbound distribution on the final mile leg, which is handled by Amazon and its delivery partners.

LTL carriers like XPO move a large amount of freight to Amazon’s distribution centers. However, the process sucks up a lot of LTL trailer capacity, and equipment can sit for days at Amazon’s locations before it’s unloaded, according to an industry executive who requested anonymity. 

The issue is not foreign to shippers and carriers hauling inbound freight to Amazon locations, the executive said. At this point, though, the practice has disrupted XPO’s LTL network to the extent that it felt it necessary to pull the plug.

Neither company responded to requests for comment. 

In an operation such as this, which is common in the retail supply chain, shippers may pre-pay the freight charges directly to the carrier, or retailers will compensate the carrier. Typically, a direct pre-pay from the shipper is more profitable for the carrier, the executive said. 

However, 3PLs may be using their volume clout to dilute XPO’s margins, which may have led to Friday’s decision, the executive said.

The timing of XPO’s decision could blindside shippers used to the carrier trucking their goods to Amazon locations. “Basically what XPO is saying to shippers, and particularly to 3PLs because that’s who this is directed at, is to find another carrier to ship inbound to Amazon,” the executive said.

XPO’s move parallels, albeit indirectly, a mid-June decision by FedEx Freight, the LTL unit of FedEx Corp. (NYSE:FDX) to abruptly stop truck pickups at many locations in order to restore normal productivity levels at overwhelmed terminals. 

LTL networks have been buffeted by soaring domestic demand as well as knock-on effects of the escalating congestion problems at U.S. ports, particularly on the West Coast. XPO, like FedEx Freight before it, is looking for ways to resolve LTL network challenges. “This is like what (FedEx Freight) did,” said the executive, referring to XPO’s action. “It’s just worded differently.”

The Struggle is Real!

First, I like to congratulate the very brave and persistent XPO employees of Florida and New Jersey on their new Teamster contract! 

It has been a very long time coming. But with this victory more will come.

Our struggles at FedEx Freight were very difficult.  With their anti union tactics of everything from, one on ones, anti-union propaganda and firing of pro union employee, using " constructive terminal" tactics and just outright lies. FedEx had deterred most of our terminals from moving forward. Except for our Stockton Teamsters.Who still haven't negotiated a contract, because of FedEx's not keeping their promise of "if a terminal would vote for representation we will negotiated". But have won several unfair labor charges against FedEx. They are alone.

XPO Teamsters beware! Though you are getting  contracts,which is a very good thing, yes. But don't underestimate XPO's attempts to find some of their loyal employees to try to decertify or undermine your successful campaign.

With your success, courage and will. You may have paved the way for others to follow your lead. Are you listening FedEx Freight employees!

Your Brother from FedEx Freight

Rudy Hernandez / aka irudedog 

P and D driver

San Bernardino Ca.