Although it’s been on parcel shippers’ minds for almost a year, there is still frustratingly little public discussion or sign of progress from UPS and Teamsters about their labor contract that expires on July 31.
A strike at the carrier would be a big deal for many companies, and the longer the dispute drags on, the harder it will be for shippers to deal with a strike if it occurs. UPS shippers are already stuck in a precarious position, and the common advice being given (e.g., switch your volume to FedEx, the USPS, or regional carriers) isn’t all that helpful. None of those providers are interested in offering short-term capacity.
If the worst happens, shippers will need to be creative with finding alternative delivery options and managing customer expectations. The first step to figuring out your options is to look at your parcel data and determine where those opportunities lie. TransImpact can help.
Regardless, the reality is UPS customers need resolution ASAP. But there are reasons for optimism. Related labor disputes have been resolved recently, including between LTL carrier ABF and the International Brotherhood of Teamsters, FedEx and its pilot union, and the ILWU and West Coast ports.
Reportedly, the Teamsters union has a $300M strike fund to pay workers during a stoppage. According to the Teamsters website, the maximum benefit a full-time union member can receive is $520 per week, with part-timers making as little as $200. For employees used to making close to $100,000 per year on average, that may not be enough to sustain their commitment to a prolonged strike.
As we’ve stated, news and progress reports have been scarce, but there have been three notable recent announcements:
1 – On June 20, the two sides announced an agreement on all non-economic issues, meaning that now all remaining issues affecting a potential new contract have to do with compensation. Historically, however, these are the most contentious.
2 – On June 16, the union voted to authorize a strike. This means the union is in agreement a strike CAN happen, not that it WILL happen.
3 – On June 14, the two sides agreed on heat safety measures that include adding air conditioning to delivery trucks.
Other than these updates, UPS customers will need to wait eagerly for any additional news that becomes available.
For ongoing updates on the labor talks:
UPS posts information here: https://about.ups.com/us/en/newsroom/negotiations/weekly-updates-from-the-bargaining-table.html
For a no-obligation review of your parcel spend, and our tips for minimizing the impact of a strike, visit www.transimpact.com.