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UPS-Teamsters negotiations collapse as strike appears imminent

The union representing nearly 340,000 UPS workers says the company has "walked away from the bargaining table," paving the way for a strike.
UPS-Teamsters negotiations collapse as strike appears imminent
Posted at 7:20 AM, Jul 05, 2023

Following marathon negotiations, the labor union representing nearly 340,000 UPS workers claims the company "walked away from the bargaining table" early Wednesday morning.

Negotiators for the International Brotherhood of Teamsters said they unanimously rejected an "unacceptable offer" that didn't address members' needs. The move comes a week after the union gave UPS a June 30 deadline to present a "last, best, and final offer."

"This multibillion-dollar corporation has plenty to give American workers — they just don’t want to," Teamsters General President Sean M. O’Brien said in a statement. "UPS had a choice to make, and they have clearly chosen to go down the wrong road."

Contract negotiations have been ongoing for months, with workers demanding a five-year agreement that guarantees higher wages for all workers, more opportunities for full-time employment, the elimination of its so-called "two-tier wage system," an end to forced overtime work, and additional protections from heat and other workplace hazards.  

UPS has defended its stance on things like pay and overtime work, claiming its delivery drivers make $95,000 a year on average and the company and its workers "need to remain flexible to meet the changing needs of our customers." UPS has also agreed to equip all new package delivery vehicles with air conditioning starting in 2024.

"We have nearly a month left to negotiate," UPS said in a statement. "We have not walked away, and the union has a responsibility to remain at the table." 

UPS workers voted overwhelmingly last month to authorize a strike if the company and its employees can't agree to a new contract by July 31, setting the stage for the largest U.S. labor walkout since the 1959 steelworkers' strike when half a million were off the job for nearly four months. 

SEE MORE: Labor negotiations at UPS could have nationwide ripples

With millions of people relying on delivery services for essentials like food, clothing and medication, a potential strike would bring a large swath of the U.S. economy to a grinding halt. It would also pose broader complications for companies like Amazon, which allows sellers to ship goods through UPS. 

Jason Miller is a professor and interim chairperson for the Department of Supply Chain Management at Michigan State University's Eli Broad College of Business. He says if a deal isn't reached by the July 31 deadline, a strike would bring chaos to America's supply chain, not only impacting consumers, but businesses, too.

"You're talking about sectors like national defense and aerospace production being very affected ... Farmers are going to be getting around to go into harvest season. Well guess how a lot of these parts get shipped from central distribution centers to forward dealers that fix farm equipment? They get shipped by parcel," Miller said. 

Not all hope is lost for an agreement, however. Miller says large companies will most likely be petitioning the White House to intervene in the negotiations, since the delivery of 20 million packages will be at stake.

"Shippers will be very aggressive and essentially pleading with the Biden administration to say, 'Hey, let's not go through this,'" he said. 

Atlanta-based UPS said it made record profits in 2022, delivering an average of 24.3 million packages per day to more than 220 countries and territories around the globe. It also issued some $8.6 billion in dividends and stock buybacks that year.

The last time UPS had a strike was in 1997. It lasted 15 days and crippled the company, losing an estimated $850 million in business. 

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