With UPS strike deadline nearing, company and union resume talks

With only one week left to reach a deal, UPS company officials and union negotiators returned to the bargaining table Tuesday to avoid a strike of 340,000 workers that could hobble the U.S. economy.

UPS and the International Brotherhood of Teamsters union have already reconciled some of the more contentious issues, with UPS agreeing to install air conditioning in delivery vans and eliminate a lower-paid class of worker. But the parties remain at loggerheads over pay and benefits for part-time workers, who make up more than half of UPS’s workforce.

Without a deal, UPS employees will walk off the job at midnight Aug. 1, Sean O’Brien, president of the Teamsters union, has said.

“If UPS chooses to not do the right thing and reward the people who have made them a tremendous success, they’re going to strike themselves,” O’Brien said at a Teamsters rally in Atlanta on Saturday.

A spokesperson for UPS said the company is “prepared to increase … industry-leading pay and benefits.”

The creator economy was already exploding. Then Hollywood went on strike.

A strike at UPS would have far-reaching implications for the U.S. economy, as well as the country’s labor movement. When UPS went on strike in 1997, the company permanently lost loyal customers, and small and large businesses alike suffered.

Today, far more companies, as well as a bigger chunk of Americans’ spending, are reliant on delivery infrastructure to transport packages across the country within days of purchase, and the strike would be the largest for a single employer in decades. UPS plays a sizable role in the booming delivery industry, handling roughly a quarter of some 59 million packages shipped nationwide daily, according to the Pitney Bowes Parcel Shipping Index.

Labor leaders say the UPS contract deal is crucial to the union movement, which has shrunk by half over the past four decades. A deal could influence future access to blue-collar jobs with middle-class pay and benefits.

White House press secretary Karine Jean-Pierre said Monday she is “optimistic” that the parties will be able to reach a deal before the strike deadline. President Biden, who has touted himself as the “most pro-union president” in U.S. history — but who disappointed some railroad workers after forcing a contract last year — has not taken a public stance on the negotiations.

A rarely used legal tool grants the president the authority to seek court orders to end strikes that jeopardize the national economy, but O’Brien recently asked Biden not to intervene if the Teamsters strike against UPS.

A spokesperson for UPS said the company has routine conversations with the Biden administration about its “industry-leading pay and benefits” and relationship with the Teamsters.

Businesses are cutting workers’ hours in a warning sign for the economy

In recent weeks, hundreds of UPS employees in brown work uniforms have staged “practice picket” lines from New York to Hawaii, marching outside UPS facilities and posing by giant inflatable pigs, symbolizing corporate greed, in preparation for a work stoppage.

At the heart of the dispute are pay and benefits for the company’s more than 150,000 part-time workers who load and sort packages in warehouses. The starting wage for part-timers, currently $16.20 an hour, has not kept up with inflation since their pay structure was separated from that of the more lucrative delivery driver role in the early 1980s. O’Brien has frequently described the job as “part-time poverty” in speeches and television appearances, and union members have noted that wages are comparable in some instances to the fast-food industry.

Amber Mathwig, 41, a part-time UPS warehouse worker and Navy veteran in Shakopee, Minn., said she and her co-workers would support a strike. “It’s about showing that our labor, especially part-time labor, is valuable and makes this country run every day,” she said.

UPS officials have rejected the union’s claims that part-timers are underpaid, noting that part-time employees at UPS make an average of $20 an hour after their first 30 days on the job. They also receive annual raises, the same health benefits as full-time employees and pensions that today are exceedingly rare for private-sector workers, UPS said.

Contract negotiations that began in April broke down July 5, when the Teamsters rejected an offer from UPS on wages and benefits packages, leading experts to warn that a strike was increasingly likely. For nearly three weeks, the parties did not meet. Now they will have seven days to hash out a deal.

If the parties reach an agreement before Aug. 1, the union will hold off from striking and the agreement will be sent to union members to vote on, a process that takes about three weeks. If members vote down that deal, the union will then strike, labor leaders say.

Sean O’Brien’s summer of the strike

Experts say a UPS strike would hit e-commerce deliveries first, creating delays similar to those experienced by consumers in the early days of the covid-19 pandemic. If the strike extends beyond a few weeks, business shipments including critical medical supplies could be disrupted. And a months-long strike could create backlogs that extend into the holiday season, logistics experts say.

Last week, a coalition led by the Chamber of Commerce sent a letter to Biden asking him to intervene in contract negotiations by helping the parties reach a deal, noting that UPS ships crucial supplies such as baby formula, cancer screening tests and semiconductor chips.

“Given the debilitating impact of a strike on American families and the economy, we urge your Administration to provide the support necessary to help the parties reach a new agreement,” the group wrote.

The consulting firm AEG has estimated that a 10-day strike would result in losses of more than $810 million for UPS. During a strike, the company’s operations would probably continue at a limited capacity, with corporate employees and its fleet of gig workers taking on warehouse and delivery roles.

Some industry experts say a strike could inadvertently hurt the Teamsters if nonunion shippers, such as FedEx, build up their share of the market during a strike.

But labor experts say a strike that results in big gains for UPS workers could inspire other workers, such as Amazon’s nonunion workforce, to organize. (Amazon founder Jeff Bezos owns The Washington Post. The Post’s interim CEO, Patty Stonesifer, sits on Amazon’s board.) More than 170,000 actors and screenwriters in Hollywood are striking, and an additional 150,000 autoworkers employed by Ford, General Motors and Stellantis could strike as soon as Sept. 14.

Jeff Stein contributed to this report.

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