BNA Daily Labor Report: Teamsters Approve UPS Contract, Five Supplements Rejected

November 21, 2007: Members of the International Brotherhood of Teamsters ratified by a 65 percent approval rate a new national five-year contract with United Parcel Service that provides wage increases of $4 per hour over term while securing existing benefits, the union announced Nov. 20.

However, the rejection of five regional or local supplements to the contract will require renegotiation and re-voting before a settlement can be finalized to cover 240,000 IBT-represented UPS employees nationwide, according to IBT spokesman Bret Caldwell.

With about 90,000 members voting, the union estimates that 65 percent of those voting favored approving the national contract, Caldwell said. Final numbers were not immediately available, he said, because the union hired an independent organization to count the votes, and that group will not report final results until after all details have been confirmed.

"But any time you get two-thirds of the members voting in favor of a contract, it's a strong endorsement," Caldwell told BNA. About 190,000 ballots were printed and mailed to active members, so it appears that the participation rate among eligible voters was about 50 percent, he said.

IBT members voted on a total of 32 regional or local supplements to the national contract, Caldwell said, and all but five of these were approved. Members rejected five agreements--the IBT Local 804 supplement, the central Pennsylvania area supplement, the western Pennsylvania supplement, the IBT Local 926 carwash supplement, and the Hawaii rider--and these will all be renegotiated and re-voted, Caldwell said.

UPS Confident on Year-End Target

UPS spokesman Norman Black told BNA Nov. 20 that the company "is very happy to learn that the national master contract is being approved by a wide margin."

"We understand that there will be some supplements [to the national agreement] to be discussed with the union, and we will be meeting with them soon to see what needs to be done. We are absolutely confident that we will be done before the end of the year," he said.

Black added that contract supplements had been rejected in ratification votes many times in the past, "so there is nothing unusual in this for us." The company remains confident that all issues can be resolved and that the company can meet its target date of Jan. 1, 2008, to have all elements of the new agreement ratified, he said.

"The goal is that we get these [outstanding supplements] resolved," said IBT's Caldwell. "I think it is up to UPS how fast or how easily this gets done."

Tentative agreement on the national contract, the supplements and riders, and a related agreement regarding the Central States Southeast and Southwest Areas Pension Fund, was announced Oct. 1.

The proposed national contract, supplements, and riders increase wages and secure existing benefits, while a separate agreement allows UPS to exit the Central States pension fund by making a one-time cash payment of $6.1 billion to cover its withdrawal liability for workers who are pension plan beneficiaries

Supplements Rejected

Unofficial vote totals were posted on the IBT Web site Nov. 20, and on the Web site of Teamsters for a Democratic Union, a rank-and-file organization that has been strongly critical of the UPS contract.

In the New York City area, a proposed supplement that would cover about 7,000 UPS employees represented by IBT Local 804 was voted down 2,203 to 895, TDU said. Local 804 voters also turned down the national agreement in a 2,307 to 802 vote, according to TDU.

The union's proposed Central Pennsylvania Area Supplement, which would cover seven IBT locals, was turned down by a vote of 1,269 to 994, IBT said. The national agreement was rejected by voting members of those seven locals 1,273 to 985, according to IBT.

The proposed Western Pennsylvania supplement, which would cover eight union locals, was voted down 1,024 to 979, IBT said. The voting members in that area, however, approved the national agreement 1,030 to 972, the union said.

TDU spokesman David Levin said the voting results in the New York area were influenced by criticism of the contract by TDU and others. TDU distributed flyers urging members to vote against the contract, he said, and promoted its opposition in face-to-face campaigning at worksites and union halls. One of the most controversial elements of the Local 804 supplement, he said, were restrictions on pension benefits for new employees.

TDU said the union's constitution states that the national contract cannot be ratified until all supplements are approved.

In addition, former Local 804 President Ron Carey, who also served one term as IBT general president, publicly criticized the proposed UPS contract, he said.

"I wouldn't say that Carey's criticism was responsible for the vote, but I do think it made a difference in the sense that members who were inclined to vote against it didn't feel like they were alone out in the cold," Levin said.

The other rejected agreements would have covered much smaller bargaining units, Caldwell said. The Local 926 Carwash agreement, covering some employees based in Pittsburgh, and the Hawaii Rider would have covered only several hundred IBT-represented workers combined, he said.

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