LOUISVILLE, Ky. (WDRB) -- UPS reached a contract agreement with its 340,000-person strong union Tuesday, averting a strike that had the potential to disrupt logistics nationwide for businesses and households alike.
The Teamsters called the tentative agreement "historic" and "overwhelmingly lucrative." It includes, among other benefits, higher wages and air conditioning in delivery trucks.
The agreement ensures the union will not strike next week, though a walkout is still possible if rank-and-file Teamsters buck their leaders and reject the deal in a nationwide vote next month.
"Together we reached a win-win-win agreement on the issues that are important to Teamsters leadership, our employees and to UPS and our customers," Carol Tomé, UPS chief executive officer, said in a prepared statement. "This agreement continues to reward UPS’s full- and part-time employees with industry-leading pay and benefits while retaining the flexibility we need to stay competitive, serve our customers and keep our business strong."
In Louisville, the home of UPS' global air operations and about 12,000 UPS Teamsters, a local union official called it "the single richest contract I've ever seen."
"The general wage increases they've shown in the (contract) highlights are just about double what was in the last five-year agreement. That's unheard of," Teamsters Local 89 communications director Stephen Piercey told WDRB News. "... We've taken a good chunk out of them in this contract, and we're quite proud of that."
What's in the contract?
The Teamsters released only bullet points of the contract details Tuesday, leaving rank-and-file members scrambling to interpret the language and wondering about items, such as pensions and health insurance, that were not mentioned.
Piercey said details would likely become available next week following a July 31 review of the terms by local union leaders.
According to the summary, the contract would establish a new wage floor of $21 per hour for UPS' entry-level, part-time workforce. Those who currently make less than $21 would be bumped up.
The Teamsters' negotiated minimum is currently $15.50, but UPS has to pay at least $16.20 as a federal contractor.
Can we breathe a sigh of relief?
At the other end of the spectrum, package car delivery drivers would go from a top rate of about $42 per today to $49 by the end of the five-year agreement.
Current workers would also get annual raises, starting with a $2.75-per-hour increase in 2023.
In addition, the contract includes a "longevity" wage increase for part-time workers who have been on the job several years. That's meant to address a common complaint: that workers who have been with the company 10 years or longer are sometimes making the same as new hires.
The longevity increase is worth up to $1.50 per hour, according to the Teamsters summary.
The raises would be given on a spectrum: those who have five years of service would get $0.50 per hour; those with 10 years would get $1 and those with 15 years would get $1.50, according to a source familiar with the negotiations.
More militant posture
Members of the Teamsters, angered by a contract they say was forced on them five years ago by union leadership, clashed with UPS over pay as profits for the delivery company soared in recent years. Union leadership was upended last year with the election of Sean O’Brien, a vocal critic of the union president who signed off on that contract, James Hoffa, the son of the famous Teamsters firebrand.
The two sides reached a tentative agreement early on safety issues, including equipping more trucks with air conditioning equipment. Under the agreement, UPS said it would add air conditioning to U.S. small delivery vehicles purchased after January 1, 2024.
But a two-tier wage system remained a sticking point. The Teamsters called it "unfair," and that is ended under the new agreement.
Profits at UPS have grown more than 140% since the last contract was signed as the arrival of a deadly pandemic drastically transformed the manner in which households get what they need.
Unionized workers argued that were the ones shouldering growth at the Atlanta company and appeared dead set on righting what they saw as a bad contract.
Member voting begins Aug. 3 and concludes Aug. 22.
UPS has the largest private-sector contract with workers in North America and the last breakdown in labor talks a quarter century ago led to a 15-day walkout by 185,000 workers that crippled the company.
Copyright 2023 WDRB Media and The Associated Press. All Rights Reserved.
