UPS workers held a practice picket in Philadelphia July 13. Pickets around the country showed UPS how serious the strike threat was. Photo: Joe Piette, CC-BY-NC-SA 2.0
With just a week to go before the strike deadline, UPS and the Teamsters announced a tentative agreement July 25. There will be no strike on August 1.
It’s clear their strike threat paid off in a big way—to the tune of $30 billion, the union’s calculation of how much more UPS is spending on this contract than the last one.
“This contract is going to show the Amazons and the Walmarts and the Targets that the Teamsters are here, there’s a shift, and they should be careful and start driving up their wages,” said New York City Local 804 President Vinnie Perrone, an international trustee who served on the bargaining team.
Among the wins that will reverberate around the labor movement is the elimination of the lower-paid second tier of drivers, known as 22.4s after the article in the last contract that created the position.
Upon ratification, all second-tier drivers will be immediately reclassified into the first tier: Regular Package Car Drivers.
It’s a good precedent for the Auto Workers, another union newly led by reformers, which just kicked off bargaining with the Big 3 automakers. In the auto plants, eliminating tiers is a popular demand.
The sticking point in the final weeks of UPS bargaining was the low pay of part-timers, a majority of the workforce, who do the bulk of the loading, unloading, and sorting inside warehouses.
Currently their starting wage is $15.50 an hour, sweetened in some areas by a “market rate adjustment” to aid hiring, so part-timers receive a patchwork of rates. Their starting pay has only increased by $7.50 in the last 40 years.
Under the tentative agreement, the starting wage for newly hired part-timers (and the minimum for all part-timers) will be $21. By the end of the contract, the starting rate and the minimum will both rise to $23.
Current workers are getting an even bigger bump. Full- and part-timers alike will get a $7.50 raise over the five years, including an immediate raise of $2.75. (For part-timers, the immediate raise is $2.75 or to $21 an hour, whichever is more.) All current part-timers will be making at least $25.75 in five years, while those hired from now on will be making $23 by then.
About one-third of the part-time workforce has five or more years in. These long-timers will get an additional one-time longevity bump for those with at least five years (50 cents an hour), 10 years ($1), or 15 years ($1.50).
Market rate adjustments will remain at the company’s discretion, but members working under MRAs will receive the contractual raises, which wasn’t true before.
The union has mapped out some wage examples to show the raises that workers in different categories will get over the life of the contract, if it is approved.
Arguably this deal creates a new wage tier within the part-time workforce—since part-timers hired after August 1, 2023, will never catch up to those hired before that date. It’s an unusual tier, though. Usually two-tier involves a concession: existing workers hold onto something for themselves but give it up for new hires. In this case, new hires are getting a boost, while existing workers are getting a bigger boost.
The union also won a $1,000 increase in the monthly pension payout for the 60,000 Teamsters in the Central and Southern regions who are covered by the IBT-UPS Pension Plan (the workers who were formerly covered by the Central States Pension Fund, until the Teamsters under Hoffa allowed UPS to withdraw from it in 2007). All other pensions are maintained at the current level.
Part-timers are only guaranteed three and a half hours per shift; many would rather have a full-time job. This deal requires UPS to create 7,500 new full-time inside jobs by combining 15,000 part-time ones.
Previous contracts had loopholes that allowed union leaders to brag they had won more full-time jobs but allowed UPS not to create them. This is the first time since 2002 that the union has won new full-time inside jobs in any meaningful number.
On surveillance: There will be no driver-facing cameras, nor audio or video recording devices. Outward-facing cameras are allowed, but cannot be used for discipline.
“Driver-facing sensors,” similar to the kind in many new cars that beep if you’re straying over the lane line or tailgating, are allowed only for the purpose of triggering audible distracted-driving alerts. These alerts may be used for “identifying coaching/counseling opportunities” during a 30-day training period. After that, the sensor data will not be collected and cannot be used for discipline.
On extreme heat: All new trucks, which over the course of the five-year contract will include about one-third of the delivery fleet, will have air conditioning. When replacing old trucks with new ones, the hottest areas of the country are to be prioritized first.
Existing delivery trucks will get a single fan installed within 30 days and a second fan by next June. Within 18 months, they are also to be retrofitted with exhaust heat shields and air induction vents, both of which will come standard on the new vehicles.
A labor-management Package Car Heat Committee is created, and charged with figuring out how to add floor insulation and otherwise reduce the temperature in the trucks.
In the warehouses, UPS agrees to provide adequate drinking water, ice machines, 18,000 new fans, 2,500 new water fountains, and a graduated workload for the first week as new hires adjust to the miserable conditions.
What else? UPS agrees to provide a private place, other than a bathroom, for pumping breastmilk.
The deal also increases various financial penalties the employer pays on grievances over harassment, excessive forced overtime, and supervisors working. For instance, the penalty for hours that a supervisor did bargaining unit work will increase from triple the employee’s wage to quadruple.
Those high numbers reflect the fact that UPS routinely pays out these kinds of penalties and persists in violating the contract.
Also on harassment: UPS will have to give 24 hours’ notice and a reason before a supervisor rides along with a driver, unless there’s been an accident or injury.
The agreement says that UPS cannot force any package driver to work on their scheduled days off—eliminating forced overtime on a sixth punch.
The package delivery workweek is codified as Monday-Friday or Tuesday-Saturday. Drivers hired before August 1, 2019, cannot be forced into the Saturday schedule. Those hired afterwards bid on their workweeks. The former 22.4 drivers automatically work Tuesday-Saturday unless there are Monday-Friday routes left over.
However, the deal also allows the employer to transition to a seven-day delivery operation. First UPS has to meet and discuss the new workweek with the affected local and the international union; disagreements will be decided by an arbitrator.
Martin Luther King Day will be added as a holiday.
OUTSOURCING AND SUBCONTRACTING
A big issue for feeder drivers, who move packages from one UPS facility to another in tractor trailers, was to limit subcontracting of their work. Under the tentative agreement, subcontracting cannot be used to avoid overtime for union feeder drivers, and UPS may not subcontract if any qualified union feeder driver is available or on layoff.
Likewise, delivery drivers wanted to eliminate Personal Vehicle Drivers—unbenefited temps who deliver packages from their own cars during the busy season, in a kind of Uber-ization of the job.
The existing contract says package car drivers cannot be forced to deliver from their own personal vehicles. But UPS has been hiring PVDs from outside the union workforce, sometimes taking away hours that union drivers wanted.
This deal limits the use of PVDs to five weeks of the year: November 15-December 26. UPS part-timers will have priority to perform all PVD work, with an eight-hour guarantee, at their usual inside rate or the starting delivery driver rate, whichever is higher. PVDs cannot take routes or overtime opportunities away from regular drivers.
UPS will be allowed to use drones or driverless vehicles, with six months’ notice and bargaining over effects.
For much of what was won, Perrone said, “it’s going to take the members and the union to enforce it.”
UPS can be counted on to implement the wage increases, he said, but it will require union militancy to make sure the company really does create the new full-time jobs it promised, honors the enhanced penalties for excessive overtime, follows through on the new heat protections, creates the lactation stations, and all the rest.
“We’re already focusing on how to do that,” he said, “picking out certain hot topics to focus on monthly, to not let these contractual gains just go by the wayside. We have to be focused and militant.”
He believes the empowerment and militancy that members developed during the contract campaign will be the key to ramping up the fight against supervisors’ harassment, “through the grievance process but also social media, I’ll be blunt. A lot of this is coming out in newspapers and social media, and UPS hates it. We’re going to have to keep the pressure on them on all fronts.”
Leaders of the bargaining unit for FedEx pilots have approved a tentative contractfirst advanced by negotiators on May 30that includes a 30% pay raise and improved pension benefits, the Air Line Pilots Association said late Monday.
No details were provided when the sides announced a preliminary labor agreement two weeks ago, and the FedEx Master Executive Council under ALPA didn’t even have time to review it. The signoff from union council chiefs means the deal will now go to rank-and-file pilots for a three-week ratification vote that begins July 5.
The new agreement would provide major pension improvements with alternative pension options, significant hourly pay rate increases, a retroactive recovery payment for the 18-month period when the contract was open for amendment and other quality-of-life improvements, according to an ALPA news release.
In addition to a 30% pay increase, pilots won a 30% increase to the legacy pension and a company-funded replacement for the legacy pension. ALPA said it is the largest investment in a pilot contract, on a per-capita basis, and that it substantially raises the bar on pilot retirement.
The Master Executive Council will share the full contract language with members, publish detailed information about the agreement online and go on the road to promote it.
“We took a membership-driven approach to these negotiations, with polling and direct feedback throughout the process. We negotiated an industry-leading contract and achieved improvements contract-wide. We look forward to presenting the agreement to our pilots for consideration,” said Master Executive Council Chairman Chris Norman, a FedEx captain. “The improvements to our retirement stand out. Not only did we accomplish major improvements to the existing pension benefit — improvements that we sought and management bitterly resisted in past negotiations — but we also crafted a new pension plan that sheds the negative funding aspects of our current plan. The new plan is completely sustainable and ensures that the costs of the plan charged to the company match the value that goes to the pilots. It’s a tremendous accomplishment.”
The specter of a strike overshadowed FedEx Express (NYSE:FDX) management as it tries to restructure the air network to cut costs while maintaining customer loyalty in a down market. The two sides were negotiating with the help of a federal mediator, and the union membership had given leaders the power to call a strike at the appropriate time.
A strike was not imminent because federal law governing airline labor relations requires both sides to follow a lengthy process before anyone can take unilateral action.
If ratified, the new contract will go into effect in August and become eligible for change in 2028.