Agreement Reached Between UPS and its 340,000 Union Workers, Preventing a Major Strike

United Parcel Service (UPS) has successfully negotiated a contract with its labor union comprising 340,000 members on Tuesday, thereby preventing a strike that might have caused significant disruptions in the nationwide logistics for both businesses and households.

This tentative agreement was labeled as “historic” and “extremely profitable” by the Teamsters. Among other advantages, the contract offers increased wages and the inclusion of air conditioning in delivery trucks.

Carol Tomé, the CEO of UPS, stated in a pre-prepared statement: “We jointly achieved a mutually beneficial agreement on matters significant to the Teamsters leadership, our staff, and UPS and our clients. The agreement persists in rewarding UPS’s full- and part-time workers with top-tier wages and benefits while preserving the agility we require to remain competitive, cater to our clients, and maintain our business robust.”

According to the company, this five-year contract applies to U.S. Teamsters-represented workers in small-package roles and is contingent upon the vote and ratification by the union members.

Tensions arose between the Teamsters and UPS due to a contract that the union members claimed was imposed on them by their leadership five years ago. As UPS’s profits surged in recent years, disagreements escalated over pay. The Teamsters underwent a leadership shift last year with the election of Sean O’Brien, a noted critic of the union president James Hoffa, who had agreed to the previous contract.

The parties managed to reach a preliminary agreement regarding safety matters, including installing air conditioning in more delivery trucks. As per this agreement, UPS committed to installing air conditioning in small delivery vehicles bought after January 1, 2024.

However, the issue of a two-tier wage system remained contentious. The Teamsters labeled it as “unfair”, and it was abolished under the new contract.

UPS’s profits have surged by over 140% since the last contract was signed due to the transformation in households’ shopping habits during the lethal pandemic.

The union workers argued that they were the ones propelling growth at the Atlanta-based company and seemed determined to rectify what they perceived as a poor contract.

The voting process for union members will commence on Aug. 3 and conclude on Aug. 22.

UPS, which holds the largest private-sector worker contract in North America, witnessed a labor negotiation failure 25 years ago that triggered a 15-day strike by 185,000 workers, severely impacting the company.

This story was reported by Matt Ott from Washington, D.C., and Haleluya Hadero from New York City.

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• United Parcel Service (UPS)
• Teamsters Union
• Labor Union Negotiations
• Effects of Strikes on Businesses