“The question is how long it will last,” said Todd Watson, professor of labor relations at Rutgers. “The union president ran and won by taking a more militant approach. Even if it is very close [to a deal]rank and file will be hungry to take over the company.’ If that happens, a UPS strike would affect nearly every household in the country. An estimated 6% of the nation’s gross domestic product is transported by UPS trucks each year. The explosive growth of online retail has made the company and its drivers more critical than ever to the country’s struggling supply chain. Apart from the company’s home deliveries, it also delivers many of the goods found in stores, factories and offices. Approximately 350,000 Teamsters work at UPS as drivers and package sorters out of a global workforce of 534,000 permanent employees. And it’s growing fast — the company has added about 72,000 Teamster-represented jobs since the start of the pandemic. “We want a contract that delivers wins for our employees and gives UPS the flexibility to remain competitive in a rapidly changing industry,” the company said in a statement this month. “UPS and the Teamsters have worked together for nearly 100 years to meet the needs of UPS employees, customers and the communities where we live and work. We believe we will continue to find common ground with the Teamsters and reach a good deal on all involved”. The union has not gone on strike against UPS since a nearly two-week strike in 1997. If the union goes on strike, it would be the largest single strike in the nation’s history.
Anger about the current contract
There are certainly signs of strain in the relationship between the company and the union — both its leadership and its members. A majority of members voted against ratifying the current contract in 2018, only to see the previous Teamster leadership, led by then-President James Hoffa, put it in place because not enough members participated in the ratification vote to trigger a strike. The union’s new president, Sean O’Brien, won office earlier this year, making the UPS contract a focus of his campaign. He has promised to make UPS pay Teamster members much more this time around and often talks about a $300 million strike fund the union has raised to pay members if they strike. “Our members wake up every day wanting a strike. I would say no. But are they fed up? Yes, they are fed up,” O’Brien told CNN Business last week. “Whether or not there will be a strike is entirely up to the company. We will use as much leverage as we can to get our members the contract they deserve.” The current contract expires at 12:01 AM. of the 1st of August. O’Brien promises that the union will not grant any kind of contract extension beyond that deadline. He added that in addition to improving wages and benefits, the union will demand better working conditions, including adding air conditioning to panel trucks used for UPS deliveries, which the union says poses a health risk to drivers. “It’s not a heavy lift for the company to install air conditioning,” he said. “There’s a lot of heatstroke.”
Record earnings at UPS
The company often talks about how much it values its Teamster-represented workforce. And in one important way — the employment numbers — UPS is one of the best friends labor has in the ranks of US corporate management, despite the obvious tensions. UPS is one of the few unionized employers that significantly increases payroll and union membership. In other businesses, union membership has been declining steadily or for decades. The increase in Teamsters jobs at UPS came from a steady increase in online shopping, especially during the peak of the pandemic season. Last year, it took only nine months to report a record profit for a full year. UPS closed 2021 with operating income up 50% to $13.1 billion. In the first half of this year, profits rose another 10% compared to a year ago. “Everybody is getting richer and richer except our members,” O’Brien said. UPS CEO Carol Tome, who took the job as soon as the pandemic began, says the company’s union contract is a competitive advantage at a time of labor shortages. He is also trying to reassure both investors and UPS customers that the company will be ready in case the union goes on strike. He declined to comment on what those preparations are. “Our goal with the Teamsters is win-win-win,” he told investors in July. But he added that UPS is “making contingency plans.”
