The Teamsters Union ratified their contested contract the with United Parcel Service, eliminating the risk of strike that would have paralyzed shipments across the United States.
The International Brotherhood of Teamsters posted on social media on Aug. 22 that drivers had overwhelmingly voted to ratify a “historic collective bargaining agreement” with the shipping giant.
UPS and the Teamsters had made a tentative deal on July 25, just days before their current contract was set to lapse at the end of the month, but it took some to iron out some of the remaining details.
The ratification process took four weeks since to complete, after tense negotiations over the summer, as over 300,000 UPS threatened to strike without a new deal.
“Our Teamsters-represented employees have voted to overwhelmingly ratify a new five-year National Master Agreement that covers more than 300,000 full- and part-time UPS employees in the U.S,” UPS stated in a press release.
Teamsters Ratify New Contract After Months of Concerns
The Teamsters voted to ratify the agreement with the support of 86.3 percent of its members at the company, which will be put into effect retroactively to August 1.
The vote was the largest margin in favor for a contract ever at UPS, the Teamsters said, with a record 58 percent of members participating in the vote.
The new agreement had overwhelming support among union leadership, who voted 161-1 in favor of the deal.
Teamsters General President Sean O’Brien called the deal “the most lucrative agreement the Teamsters have ever negotiated at UPS.”Teamsters President Sean O’Brien called it “the best contract in the history of UPS.”
“This is the template for how workers should be paid and protected nationwide, and nonunion companies like Amazon better pay attention,” said Mr. O’Brien in an Aug. 22 press statement emailed to The Epoch Times.
“Teamsters have set a new standard and raised the bar for pay, benefits, and working conditions in the package delivery industry. This is the template for how workers should be paid and protected nationwide, and nonunion companies like Amazon better pay attention,” he continued.The union announced that all supplemental agreements were also ratified for the 300,000 UPS employees, with the exception of “the Local 769 LAI supplement which covers 174 members in Florida.”
Mr. O’Brien said he expects to negotiate a new deal for the workers in Miami, Florida, by this weekend, which will allow the full national agreement to take effect.
The Teamsters said that the nationwide agreement with the shipping firm would take effect “as soon as this supplement is renegotiated and ratified.”
UPS Employees to Win Generous Concessions
Full and part-time union members would receive an additional $2.75 per hour this year, while total raises will reach $7.50 an hour by 2028, or more than $15,000 a year for full-time workers.“Existing part-timers will be raised to no less than $21 per hour immediately, and part-time seniority workers earning more under a market rate adjustment will still receive all new general wage increases,” the union stated
However, some part-time UPS workers were dissatisfied with the deal, making the outcome of the vote uncertain until this week,
Many part-time workers were upset that they would still be paid less than full-time employees doing the same work, but the agreement deal still had overall support among the different category of workers.
The elimination of a lower pay scale for workers hired since 2018 was a popular concession for many of the drivers.In addition, UPS also agreed to add air conditioning to 95,000 delivery vans in its American trucking fleet, another widely supported move, which was also a major health concern.
UPS agreed to purchase air-conditioned vans starting next year, while existing vans will be retrofitted with some changes to reduce heat in normally hot cargo area.
The new contact will also make Martin Luther King Day a full holiday for all Teamsters at UPS and prohibits “forced overtime” for drivers’ on their days off.
UPS Hopes to Win Back Worried Customers
The national agreement and its ratification is an expensive concession for UPS and will raise its labor costs by more than 3 percent a year.However, the shipping company had posted strong profits in recent years, earning 70 percent in adjusted net income during the previous five-year contract.
A surge in online purchases during the pandemic gave UPS a massive boost in record profits, but adjusted income for the first half of 2023 was down 26 percent from the same period last year, according to recent earnings reports.
UPS CEO Carol Tome told investors on Aug. 8 that the company lost about 1 million packages a day to other services during the second quarter, even though the strike was not due to start until Aug. 1.
Fears of a looming strike led customers to search for other alternatives to deliver packages, but the company could have lost far more if a strike went into effect or if the union had voted no and set a new strike deadline.Ms. Tome said told investors that a ratification vote would allow UPS to win back customers that it lost due to uncertainty, and she was confident the company would be able to achieve that goal by the end of the year.
“It doesn’t happen overnight, of course,” she said, adding, that “it’s already starting to flow back in. But we think by the end of the year, we’ll win it all back.”
