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Five Key Takeaways As UPS Strike Looms With Failed Teamsters Contract Talks
(CTN NEWS) – Last week, negotiations between shipping leader United Parcel Service (UPS) and the International Brotherhood of Teamsters reached an impasse, raising the likelihood of a massive strike when the current contract expires at the end of this month.
The Teamsters, representing approximately 340,000 UPS employees, voted last month to authorize a strike if an agreement is not reached by July 31. This potential strike would be one of the largest in the history of the United States.
Here’s what you need to know about the imminent strike:
What will happen to my packages?
If tens of thousands of UPS workers represented by the Teamsters go on strike, it could have a significant impact on deliveries, potentially resulting in package delays or increased shipping costs from other companies.
UPS has stated that it handles around 6 percent of the country’s gross domestic product (GDP) solely through its transportation services.
However, the company has also claimed to have “contingency plans” in place for both the products it transports and its members who may participate in the strike, as stated to The Hill last week.
Jonathan Gold, Vice President of Supply Chain and Customs Policy at the National Retail Federation, predicts that a strike would likely disrupt the supply chain similarly to the disruptions experienced during the pandemic, leading to delivery delays.
FedEx, another major shipping company, issued a statement emphasizing that businesses considering shifting their shipping volume to FedEx should begin collaborating with the company promptly.
It also mentioned that, in the event of an industry disruption, protecting capacity and service for existing customers is its top priority.
On Monday, the United States Postal Service (USPS) launched a new “coast-to-coast 2-5-day shipping offering” and expressed its readiness to compete for a larger share of the expanding package business.
What is the dispute about?
The negotiations between the shipping company and the union revolve around wages, benefits, and compensation for workers as they seek to establish a new contract before the current one expires at the end of this month.
The Teamsters are advocating for several changes, including the elimination of a two-tier wage system for delivery drivers, an end to forced overtime on drivers’ days off, improved workplace protections, and the recognition of Martin Luther King Jr. Day as a holiday.
According to job search platform Indeed, UPS drivers currently earn $18.05 per hour in Arkansas, $17.63 in Oklahoma, and $21.02 in Connecticut.
In 2022, UPS reported a net income of $11.5 billion, surpassing expectations for the fourth quarter. The company’s operating profits for the same year exceeded $13 billion, resulting in an operating margin of 13 percent.
Earlier this month, UPS and the union reached a tentative agreement regarding the two-tier wages, overtime, and the holiday issue. This development was seen as a step to reduce the likelihood of a strike.
However, tensions persist regarding other economic aspects of the negotiations.
What will be affected by the strike?
The Teamsters union expressed its discontent with UPS on Twitter, suggesting that the company cannot afford to ignore the needs of its workforce, which includes over 150,000 part-time employees who form the backbone of its operations.
The union warned that if the company continues to show disrespect, UPS will have to confront the formidable power of the striking Teamsters.
The potential strike not only poses a threat to deliveries but also has the potential to disrupt commerce due to the mass work stoppage of warehousing, transportation, and delivery workers represented by the union.
The last time UPS Teamsters went on strike was over 25 years ago in 1997, resulting in a 15-day strike that had a worldwide impact on the package supply chain.
When will we know if UPS Teamsters will strike?
If the union and UPS fail to reach an agreement by the contract expiration date on July 31, workers are prepared to strike. The union initially aimed to finalize a deal by July 5, but due to the time required for contract ratification, this deadline could not be met.
On the July 5 deadline, the Teamsters reported that UPS presented an unacceptable offer and walked away from the bargaining table. However, UPS stated that they have not abandoned negotiations and called for the Teamsters to return to the table.
It remains uncertain whether we will have confirmation of the strike before July 31. Nonetheless, if no agreement is reached, union representatives have asserted that workers will cease work as soon as the current contract expires.
“We all have a contract till July 31st — we will work under that contract,” stated Scott Barry, Vice President of Teamsters Local 171, in an interview with outlet WDBJ7.
“Our administration has made it clear. We will not be working beyond the expiration date without the contract our members have demanded, and more importantly, without the contract our members deserve,” said Teamsters president Sean O’Brien earlier this month.
Which areas will be affected by the strike?
If the current contract expires without a resolution, the strike will have a nationwide impact.
In recent weeks, Teamsters workers have been conducting “practice pickets” at UPS hubs across the country, as reported by the union.
On Saturday, new “practice picket” actions took place in Mississippi, Alabama, Maryland, New York, Minnesota, and California, according to the Teamsters.
“As solidarity among rank-and-file members grows stronger, the nation is closely watching all UPS Teamsters, and the public support for our historic contract battle is overwhelming,” stated the Teamsters union.
“Our members are prepared to walk out on August 1 if UPS fails to provide what the Teamsters have rightfully earned.”
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