Memo: The Potential UPS Strike

The fallout would be widely damaging, but the conflict is a long time coming. The United Parcel Service changed commerce by enabling the online retail revolution that defined the last decade. Now, UPS workers are threatening to strike – something that’s been reported on as a potential inconvenience for Amazon, countless retailers, and millions of customers. The current workers’ contract, which the threat of a strike is centered on, was approved by a leadership group that included Jimmy Hoffa Jr, the president of the Teamsters union, whose largest employer is UPS. Hoffa is also the son of Jimmy Hoffa, the labor movement icon and former Teamsters president who disappeared in 1975.

The current contract between Teamsters and UPS is due to expire on July 31. Sean O’Brien, the Teamsters General-President, suggests that UPS workers will strike on August 1 if a deal isn’t reached by the close of business on July 31. Vinnie Perone, a 30 year employee of UPS and Local 804 Teamsters President:

UPS’s opening position is crystal clear: all the company wants after a year with $101 billion in revenue is more money off your backs.

Of the 534,000 members of the Teamsters union employed internationally, 350,000 are employed by UPS. The market leader in courier services has hired just over 72,000 Teamsters since mid-2018 with an average compensation of $95,000 (not including pension benefits). The contract between UPS and its union-backed workers was negotiated by Jimmy Hoffa Jr. and will be renegotiated by O’Brien to include better pay, better overtime protection, and an improved way for workers to stand up against the heat.

An estimated 6 percent of the American GDP moves through UPS, according to Jacobin Magazine’s February report; it’s one that’s worth reading if you want a deep dive into the dynamics of the potential strike.

In recent years, the working conditions of UPS employees have been a subject of controversy, with workers voicing concerns about long hours, inadequate pay, and job insecurity amidst a period of boom for online retail. A strike would impact Amazon. In 2022, UPS shipped 1.3 billion parcels that accounted for 11.3% of the company’s revenue.

These concerns have escalated over the years, but it is not the first sign of conflict. In 1997, 185,000 UPS workers didn’t work for 15 days. The Teamsters wanted to maintain control over the UPS pension fund and they wanted their employer to create 10,000 full-time positions over a five-year period (from the company’s pool of part-time contractors). Technically, the union won the negotiations, though there were lasting ramifications for both sides.

August 4, 1997, probably doesn’t stand out as a significant day in world history. But some would disagree.That’s was the first time United Parcel Service (UPS) workers organized a nationwide strike in the U.S., which ended up with the company losing almost $780 million. In the 15 days that the strike lasted, 80% of UPS shipments went undelivered.

UPS is known for its demanding and physically taxing work. According to a report by the Teamsters union, many employees suffer from work-related injuries due to the demanding nature of their jobs. Drivers often have to work 10-12 hour days, with minimal breaks, leading to fatigue and an increased risk of accidents. Moreover, package handlers often have to lift packages that weigh over 50 pounds, leading to potential injuries.

In addition to poor working conditions, many UPS workers cite low wages relative to the increasing workload. Moreover, UPS has been criticized for its practice of hiring part-time workers who earn lower wages than full-time employees and have fewer benefits.

UPS has been criticized for its use of subcontractors and temporary workers, which can lead to job instability for its employees. Many workers fear that their jobs could be outsourced or automated in the future, leaving them without employment. UPS has also been accused of engaging in union-busting tactics, such as threatening to close facilities if workers unionize or firing workers who support unionization efforts.

The COVID-19 pandemic has highlighted the importance of essential workers like those at UPS, who continued to work despite the increasing volume as the economy shifted with the online retail revolution. By most accounts, UPS (along with FedEx and USPS) rose to the occasion. However, many workers felt that their welfare had not been adequately prioritized by the company. According to a report by the New York Times, UPS workers reported a lack of adequate safety measures to address the physical stresses of heat waves.

Since 2015, at least 270 UPS and United States Postal Service drivers have been sickened and in many cases hospitalized from heat exposure. Dozens of workers for other delivery companies, including FedEx, have also suffered from heat exhaustion, according to the records, and a handful of drivers have also died in the past few years. According to the Teamsters, heat-related injuries, illnesses and deaths among drivers are severely underreported.

The larger issue of income inequality may also motivate a UPS strike. In a report noting the perceived job satisfaction maintained by UPS workers over FedEx drivers, I noted that “UPS [should consider] stock awards for its drivers so that they can begin to benefit from the profits that their work is contributing to at the local levels.”

According to a report by Oxfam, the wealth gap in the United States is at its highest level in over 50 years, with the richest 1% of Americans owning more wealth than the bottom 90%. Many UPS workers feel that they are being left behind in this economy, with their wages and benefits not keeping up with the rising costs of living or the potential upside of stock compensation earned by front office executives.

Although a strike would undoubtedly be disruptive to the company and its customers, it may be necessary for workers to achieve the changes they are seeking. In the age of eCommerce and digitalization, the demand for efficient and timely package delivery has surged. As a result, UPS has experienced tremendous growth. While this expansion should have translated into better working conditions and improved pay for its employees, the reality has been quite different. Instead, UPS workers have found themselves grappling with increased workloads, extended working hours, and a lack of job security. All of this led to widespread dissatisfaction and calls for action.

The UPS deal between management and the Teamsters is the largest (private) union contract in the United States. According to reports, CEO Carol Tomé downplays the threat:

The Teamsters have been part of the UPS family for more than 100 years. So over 10 decades, we’ve negotiated many, many contracts. This is not our first rodeo,” she said. She insisted the company will be be to find a common ground in negotiations that will be a win for the company, its employees and its customers.

The Teamsters union members aren’t so sure. They are preparing for a strike. “Do our members wake up every day wanting a strike? I’d say no. But are they fed up? Yes, they’re fed up,” President Sean O’Brien said in response.

By Web Smith | Edited by Hilary Milnes with art by Alex Remy and Christina Williams

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