Why No Fizz in the UPS COLA?

Why No Fizz in the UPS COLA?The UPS contract has a cost of living allowance (COLA), which was played up in selling the contract as the “best ever.” Why then do we never get anything out of this clause?

An examination of the details of Article 33 shows why. There are three fine-print facts to know about the clause. First, before the COLA kicks in, the inflation rate has to exceed 3 percent on a May to May yearly basis. From May 2004 to May 2005 that rate was 2.9 percent, so no COLA. Second, even if it got a little over three percent, it would still pay zero, because the formula has to get to a five cent raise or it doesn’t count. This means inflation has to exceed about 3.5 percent to get that five cent wage adjustment.

If inflation rises over 3.5 percent in the specified yearly period, we would get COLA increases, starting with that nickel an hour. If inflation would go way up, we would get more than the nickel, based on a formula which covers about one-third of inflation. Thus if inflation jumped to five percent, unlikely but always possible, we could get a 19 cent per hour COLA adjustment.

The International officials who negotiated the agreement have a superior COLA formula. They automatically get the same percentage increase in union salary that the cost of living goes up.


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