UPS Tentative Agreement Report

Mark Solomon
DC Velocity
May 01, 2013

Teamster union workers at UPS Inc. will receive wage increases totaling $3.80 an hour over the next five years, under a tentative contract agreement made late last week between union leaders and the Atlanta-based company, according to a communiqué issued over the weekend by Teamster dissident group Teamsters for a Democratic Union (TDU).

The wage increases will be spread over seven separate payments starting Aug. 1, 2013 through the end of the contract on Aug. 1, 2018, according to the TDU communiqué. For full-time drivers, the proposed increases would raise hourly wages to $36.05 by the end of the contract.

Contracts—which will cover about 240,000 workers at UPS' core small-package business and an additional 10,000 to 12,000 members at its UPS Freight less-than-truckload (LTL) unit—would take effect Aug.1 if ratified by the rank-and-file at the package unit and the LTL operation. The current contracts are set to expire the day before.

It was unclear at press time if the proposed wage increases applied only to workers at the package unit or to UPS Freight employees as well.

The tentative contract would set starting pay at $10 an hour for part-timers at the package operations, according to the TDU document. This would represent a $1.50-an-hour increase in starting wages for part-timers.

Representatives from every Teamster local will convene May 7 to review the proposals, according to the TDU document. Following that meeting, ballots will be mailed to each member, who will cast votes by mail. The results will be disclosed around mid-June.

Teamster members will vote on the nationwide master contract as well as any applicable "supplemental contracts." Some members will get a third vote on any local attachments, or "riders," that apply to them. Given the scope and complexity of UPS-Teamster contracts, many unanswered questions remain. It is possible that the current language may be modified once union representatives finish reviewing the document on May 7.

DC Velocity reported in late March that the union had demanded a $1-per-hour wage increase in each of the contract years and a $1.50-per-hour annual increase from current levels to cover pension and health benefits. The current contract, reached in 2007, calls for a $1-an-hour annual increase in the company's contribution benefits.

The union also sought at the time an increase in part-time starting pay to $15 an hour from the current $8.50 an hour.

Full-time Teamsters with 30 years of service and enrolled in the union's Central and Southern Region health and welfare plan will see their pensions rise to $3,200 a month in 2014 and to $3,400 a month by 2017, according to the TDU communiqué. Those members receive the lowest retirement benefits of any unionized full-time UPS worker in the country, TDU said.

For all other Teamster funds, health, welfare, and pension contributions will increase by $1 an hour per year, TDU said.

The document did not address what, if any, operational changes would take effect under the contract. Nor did it address the thorny and long-standing dispute over the number of part-time union jobs UPS is required to convert into full-time positions.

The tentative agreement requires UPS to create more than 2,000 full-time jobs over the life of the contract by combining part-time positions into full-time slots. Language addressing the conversion of jobs to full-time from part-time first appeared in the 1997 contract after the Teamsters shut down UPS for 15 days that summer with a nationwide strike. The provisions back then required the company to create 20,000 full-time jobs out of part-time positions over a 10-year period from 1998 to 2008.

The Teamsters, and in particular TDU, have long contended that UPS has not done all it could in the past 15 years to create that many full-time positions.


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