On The Brink?: The Teamsters and UPS

In less than ten weeks, the Teamsters’ national contract with United Parcel Service (UPS) will expire, at midnight on July 31. Expectations for the contract are running high, a sharp change from past contract negotiations under former Teamster General President James P. Hoffa, Jr. The current leadership of the Teamsters, General President Sean O’Brien and General Secretary-Treasurer Fred Zuckerman, have repeatedly stated that, if there is not a tentative agreement that resolves key issues, there will be a national strike.

The Teamsters union—with some seasonal fluctuation—represents around 330,000 workers at UPS. If a strike occurs, it will be the biggest industrial strike in a generation. It has the potential to raise the class struggle to a new level in the United States, as well as having wide-ranging effects on the labor movement, from the upcoming UAW negotiations with the Big 3 automakers to organizing at Amazon. This strike would be similar to the 1997 UPS strike that thrilled the labor movement and the Left but  whose potential wider impact was thwarted by the federal government’s  intervention following the strike.

Re-writing history

The threat of federal intervention hangs over the current negotiations between the Teamsters and UPS, not only because of the Biden administration’s heavy-handed intervention to block the Rail unions last year from striking. But, as Sean O’Brien revealed during a speech in southern California that he has been to the White House to discuss the UPS contract. After a meeting at the White House, O’Brien declared, “I want to tell you this because our brothers and sisters in the [Teamster] rail division, they felt that the administration interceded, which isn’t the truth.”

Why O’Brien, who was at the White House making the case against federal intervention in the UPS negotiations , made such a bizarre declaration is worrisome. It is frankly indisputable that the Biden administration, along with Congress, engaged in preemptive strike breaking, and that  it was a major defeat for the labor movement. Why such a re-writing of events that took place only a few months ago? It may speak to the suffocating relationship of the Democratic Party and the trade unions in this country as well as the cautiousness of O’Brien, a career union official long associated with the Hoffa machine, despite his verbose rhetoric . As the expiration date gets closer, the Biden administration will likely play an even bigger role in negotiations.

O’Brien and Zuckerman’s militant posturing, however, represents real pressure on them both from a significant minority of Teamsters, who want a major change in the direction of the union, and from UPS, which wants to continue to erode the working conditions of full time package car jobs. UPS made it clear long before negotiation began, that it wants greater “flexibility” or more contingent, on-call, lower-paid  drivers. The UPS website announced:

Competitors – old and new alike – are offering flexible, fast service – seven days a week. Regional carriers LaserShip and OnTrac have merged to offer coast-to-coast delivery in as little as three days. DoorDash has a fleet of 6 million drivers, up from 100,000 just five years ago.

Many retailers offer online pick up in store services within 2 hours of order while over ½ offer same-day or next-day delivery. A small number of large retailers also deliver products for other retailers using independent contractors or gig workers.

In the face of these changes, we must stay flexible to compete and win.

O’Brien’s political future in the Teamsters and his larger role in the labor movement will rest largely on making real gains in the upcoming contract. O’Brien and Zuckerman, after all,  won the 2021 Teamster election largely because they opposed the disastrous 2018 UPS contract. The political stakes are running high for all parties involved: UPS, the Teamsters, and the Biden administration.

Cost-neutral?

Despite all of the strike talk, no strike votes have been taken by UPS Teamsters and will not likely occur until June or July when serious bargaining will begin. UPS’s stated goal of a “cost-neutral” contract and the Teamsters’ position of no new concessions, along with a rollback of concessions made in the 2018, make a clash between them inevitable. What form that clash will take is still unclear. Carol Tomé, the CEO of UPS, has publicly struck an optimistic, non-confrontational pose. Earlier this year she said, “I would submit that a win-win-win is very achievable because we are not far apart on the issues.”

Tomé’s confidence in the company’s bargaining position is not surprising. “Over 10 decades, we’ve negotiated many, many contracts. This is not our first rodeo.” It reflects the arrogance of the senior management of a rich and powerful corporation that almost always gets its way. UPS has handsomely rewarded its management and shareholders.  However, management’s memory is very  selective, leaving out the popular 1997 strike and waves of regional and local strikes by UPS Teamsters during the 1970s. UPS’s  easy ride during the past two decades has clouded its vision.

UPS’s major customers have given the company a vote of confidence. FedEx, one of UPS’s major competitors, attempted to snatch away major shippers, warning of a possible strike. Emails sent to UPS customers by FedEx said, “Switch your UPS shipments to FedEx before March 31, 2023 to ensure your volume is prioritized. Don’t wait until it’s too late!” No major shippers, so far, have bolted from UPS. This isn’t to say that UPS can’t be blinded by its own overconfidence. One of the major reasons that the company lost the 1997 strike was precisely because it never believed that a strike would take place.

UPS’s stated goal of a “cost-neutral” contract appears to be designed to provoke the Teamsters. How seriously can we take that position? While “cost-neutral” is highlighted continuously in the Teamsters social media posts, UPS, desperate for workers during the past two years, has raised starting wages far above the contractual starting pay for part timers, plus bonus pay for attendance. Calling these raises Market Rate Adjustments (MRAs), UPS revealed that they were willing to pay new hires as much as $20.00 an hour. The question for the Teamsters is, are they willing to push for much higher start pay after two years of soaring living costs?

Strike ready?

UPS, meanwhile, has taken the initial steps to prepare for a strike. According to Freightwaves magazine,

UPS has informed its managers not to schedule any paid time off during July and August in case parcels are required to be moved, according to multiple sources familiar with the matter who spoke on condition of anonymity. The move sends a clear signal that UPS, under CEO Carol B. Tomé, plans to continue operating even if the union goes on strike.

UPS has pursued a very disciplined approach to negotiations. The Teamsters decided to pursue negotiations on the supplements first, nearly forty of them, which are traditionally negotiated after the national contract is settled. This decision provided UPS with the opportunity to throw off the union’s stated timeline for national negotiations, which would have begun on April 17. For months, UPS negotiators dragged their feet, walked out of negotiations, or didn’t show up at all.

Ultimately, O’Brien and Zuckerman declared victory in the supplemental negotiations. Nearly all supplements have reached tentative agreements, but the bargaining parties have not released any of the details of the tentative agreements or scheduled a vote on them, which may not be possible to do until national negotiations are finished. This lack of transparency appears to be a repeat of the “Brownout” of information during contract negotiations in 2018, a lack of transparency  that O’Brien and Zuckerman have pledged to correct.

Meanwhile, there is no charm offense by UPS with its workers in the run up to the contract’s expiration date. Many package car drivers continue to work grueling shifts despite the union’s protests. I spoke to veteran package car driver David Courtenay-Quirk in Atlanta, who told me, “I work an average of fifty-six hours a week and rarely get home before 10:00 P.M. or even 11:00 P.M.”  In fact, the opposite is taking place. UPS’s notorious harassment of its drivers continues apace, while they simultaneously lay off some workers and consolidate shifts.

A first quarter drop in package volume prompted UPS to cry poor. A Teamster social media statement stated in response:

UPS recorded its highest revenue to-date [2022]— more than $100 billion. In 2023, projections are already in for a repeat, edging closer to rake in another $97 billion.

The current UPS Teamsters National Master Agreement went into effect in 2018. From 2014-2018, UPS recorded profits of $38.7 billion. Under the active agreement, UPS has tallied additional profits of $56.3 billion from 2019-2023. With their contract set to expire July 31, 2023, more than 340,000 UPS Teamsters want to know — where’s ours?

All of this is true, except that UPS is not acting as if it were afraid to take a hard line against the union. The Teamsters have responded to UPS  by ramping up activities around the country, having UPS members sign pledge cards to support the union’s demands, building plant gate rallies, and reaching out to part time workers, who still make up the bulk of the UPS workers.

Meanwhile, negotiations on the national contract have finally begun, despite two regional supplements not being settled, and the Teamsters formally submitted proposals that seek to abolish the lower paid 22.4 drivers. Sean O’Brien declared:

This will certainly be one of the biggest and most important proposals passed across the table to UPS by our committee. Any two-tier wage system isn’t going to fly with the Teamsters. We are demanding equal pay for equal work. We want to make sure all our drivers are RPCDs [regular package car drivers].

Yet, just beneath the surface there is some discontent with the state of the Teamsters contract campaign. Part timers feel that they are an afterthought, only belatedly brought into focus in the campaign, while the heavy emphasis by the Teamsters on social media, seems far removed from the reality of life inside UPS hubs across the country.

Featured Image Credit: Wikimedia Commons; modified by Tempest.