Contract Givebacks and How to Stop Them
August 1, 2008: Over the last year, the Hoffa administration has given employers the most concessionary deals in Teamster history.
Now employers are lining up to see how far our union will let them go in violating these contracts. Once again, UPS is leading the charge.
An investigation by Teamster for a Democratic Union has confirmed that UPS is cheating members out of the full-time jobs we won under the 1997 and 2002 contracts.
The contract requires UPS to create and maintain 20,000 good full-time jobs by combining low-wage part-time positions.
The deadline for completing this full-time job creation passed on Aug. 1. But thousands of these jobs were never created or have been eliminated because UPS does not fill many positions that go vacant.
Members are getting involved to make UPS deliver the full-time jobs we were promised.
In 2008, the Hoffa administration gave away record concessions to the biggest Teamster employers, not as a last resort but as its bargaining strategy.
Our report on the 2008 bargaining round explains what happened and why, and most importantly, what we can do about it.
Teamsters for a Democratic Union brings together Teamsters in every jurisdiction to enforce our contracts, stop more corporate takeaways and win stronger agreements in the future.
If you’re concerned about our union’s direction and want to do something about it, get involved today. We can protect what we’ve got, but only if we’re organized.
Concessions as Union Strategy
August 5, 2008: Over the past year, the International Union has signed four national contracts in the trucking industry, covering nearly 350,000 Teamsters—setting the pattern for many more.
In each case, the Hoffa administration gave our largest Teamster employers record givebacks. The 2008 contracts are the most concessionary master agreements in the history of the Teamsters Union.
We need to understand why this happened, and what we can do to stop future concessions and build a stronger Teamsters Union.
No one will deny that times are tough. But the 2008 concessionary contracts were not caused by the weak economy or industry problems.
If failing companies were the reason our negotiators agreed to concessions, our union would not have given billions in givebacks to UPS when the company was making record after-tax profits of more than $4 billion a year.
Jim Hoffa, Ken Hall, and other top Teamster negotiators did not turn to concessions as a last resort. They adopted concessions as a strategy—one that they implemented at UPS, freight, DHL and in carhaul.
In each case, our union agreed to trade away bedrock contract standards in exchange for the union getting new members—or just maintaining membership—under declining standards.
Concessions at UPS
Our International Union negotiated the UPS contract—telling members that early talks were needed to protect members’ benefits. In reality, chief negotiators Jim Hoffa and Ken Hall had a different goal in mind: trading away the historic gains of the 1997 UPS strike in exchange for the right to organize UPS Freight.
Hoffa and Hall negotiated a deal that let the company take 44,000 Teamsters in 25 states out of the Central States Pension Fund. That concession saved the company billions by sticking those Teamsters with a pension that will be far below Teamster plans by the end of the contract.
Hoffa and Hall also gave away the contract language that requires the company to eliminate low-wage part-time jobs and create full-time jobs in their place.
In exchange for these and other givebacks, UPS agreed to allow unionization of UPS Freight. That’s a positive gain. But working Teamsters even got the short end of this deal. Our union agreed to put UPS Freight under a substandard contract that undermines our National Master Freight Agreement.
Through UPS Freight, UPS is now in position to take work from Teamster freight carriers.
The IBT Freight Division wasn’t happy with splitting the pension fund, or with giving UPS Freight a sub-par contract. Their concerns were brushed aside.
Have Concessions Worked?
Once the mighty UPS cleaned up at the concession stand, the other employers were ready to do the same business with the Hoffa administration.
At DHL, our union gave the corporation its number one goal: part-time labor.
The union’s pitch was that now the company would grow. But, just two months after the contract was approved, management started laying-off full-time Teamsters, and offering them to come back as part-timers!
DHL also agreed to allow unionization at gateways and hubs. But now they are cutting back or closing those facilities. So the concession strategy here has been a terrible failure in short order.
In the freight contract, the corporations got total control over working conditions and a new “utility” classification. And they got the ability to hire low-wage part-time labor. Due to the recession, not many have been hired yet.
Teamster members are voting on the most concessionary contract of all, the carhaul agreement, as we go to press. Our negotiators did not swap concessions for more dues-paying members. They surrendered decades of union gains without securing anything that will position our union to organize the nonunion competition in the industry.
The Foundation of Union Power
Strong national contracts and Teamster pensions are the foundation of our union’s power.
Teamsters for a Democratic Union (TDU), along with other Teamster leaders and members, have opposed Hoffa’s concessionary contracts because they hurt working Teamsters in the short term and make it harder to preserve industry standards and organize the nonunion competition over the long haul.
Our union is at its best when we inform, involve and unite Teamster members to put some muscle behind our bargaining demands—and when we take on corporate greed in a way that not only protects members, but inspires nonunion workers to support the labor movement—and want to become a part of it.
The 1997 UPS contract is a classic example of this strategy.
The 2008 bargaining round will be remembered as the year that top Teamster officials officially adopted concessions as a bargaining strategy.
Teamster members who don’t like the direction our union took in 2008 can either complain about it—or get involved in pushing for a new direction.
At Teamsters for a Democratic Union, we are already preparing for the next bargaining round. We are building national networks of Teamsters at UPS, freight, DHL, carhaul and in other jurisdictions to share strategies for enforcing our contracts, defeating future concessions, and winning stronger agreements in the future.
If you’re a concerned Teamster, we want to hear your ideas and we want you to get involved. Join TDU.
Attend a local meeting or our upcoming TDU Convention.
Isolated, we are weak. But united, we can protect what we’ve got and rebuild union power.
Carhaul: How TDU Won the Right to Contract Observers
August 7, 2008: Rank-and-file carhaulers will have their own observers at the contract vote count next week thanks to TDU members who won that right.
When the vote was taken on the 2003 carhaul contract, some Michigan Teamsters knew the result couldn’t be right. These office and dispatch Teamsters had their own supplement, the Michigan Office Supplement, and knew it could not have passed.
They started networking, in Detroit, Flint, Lansing and Pontiac—and they confirmed that the reported “Yes” vote was false.
They decided to take action. In the end, they proved that the vote count was bogus. It didn’t help them deal with their issue of job security, because the employers had a signed contract that was legally enforceable even if it had been voted down. But they did win a right for all carhaulers: to have observers—not just handpicked ones—for the vote count process.
Three Teamsters, Donna McCuiston and Rick Miazga in Local 299, and Ava Miller in Local 332, were represented by TDU attorney Barbara Harvey when they sued in federal court over the vote. They had signed, notarized affidavits from a majority of affected members that they had cast a No vote.
The IBT attorneys took depositions of all voters who said they voted No but couldn’t shake even one.
The lawsuit revealed that the so-called election supervisor was not even present when the office supplement votes were counted. The International Union counted the votes privately in Washington, and faxed a form to the supervisor, who signed it, certifying a ballot count that he had not witnessed.
Rather than losing in court, the International Union settled the case with an agreement to grant observer rights in future contract ballot counts. As a result of the lawsuit, carhaulers won the right to have independent observers on all contract votes. The office workers were disappointed that they couldn’t overturn the contract. But they were proud to win a new right for Teamsters.
There will be observers at the carhaul vote count.
How New Rights Are Won
That’s how new rights are won for Teamsters. Members take action, with Teamsters for a Democratic Union (TDU) being the driving force.
It was TDU that put forward the issue of the Right to Vote on Contract Supplements. We built support, we drafted the constitutional language, and in 1991, we won it at the IBT Convention, after delegate Tom Griffith of Local 776 gave a magnificent speech on the issue. We won a new right.
It was TDU that put forward the right to vote by Majority Rule (instead of 2/3 to reject) on contracts. TDU members fought for it, and finally went to court, and in 1988 we settled the case and won Majority Rule on contracts. Prior to that time, freight, UPS and carhaul contracts had all been imposed on the majority.
The right to vote on contracts by majority rule. The right to vote on contract supplements. The right to independent observers at the contract vote count.
These rights make our union more accountable to our members, and make our union stronger, They make it harder for employers to stick us with a bad contract.
Teamsters for a Democratic Union: where would Teamsters be without it?
UPSers Get 35¢
August 1, 2008: UPS Teamsters got a 35¢ raise on August 1, the smallest raise in many years. Another 35¢ raise will follow in six months, for a total of 70¢ over the next year.
Last August 1, UPS Teamsters received a $1 raise. How much did gas and food cost then, compared to now? The contract also didn’t provide for a cost of living improvement this year, a serious problem when inflation has run at 4.5 percent. For a full-time Teamster, a 35¢ raise is just 1.25 percent, meaning a big loss in real wages.
One group of Teamsters involved with our UPS contract did get taken care of. They are the top union negotiators. James Hoffa received a $12,500 cost of living adjustment on July 1.
Ken Hall’s cost of living adjustment on July 1 was $5,786. That’s a much less bitter pill to swallow than 35¢.
UPS Full-Time Jobs Takeaway
August 1, 2008: Interviews with shop stewards and members in local unions across the county reveal that UPS is violating the contract when it comes to full-time job creation.
Teamster members are standing up by filing grievances and demanding that UPS create the full-time jobs the company owes us. Our International Union needs to back up members and local unions with a nationwide full-time jobs audit and contract enforcement campaign.
UPS is obligated by Article 22.3 of the contract to maintain 20,000 full-time combo positions. The contract requires the company to have completed this full-time job creation by Aug. 1—including 2,500 new full-time jobs that UPS had to create in the last year.
Not only has UPS failed to create the 20,000 jobs, but stewards across the country report that the company is destroying full-time combo jobs by not bidding the jobs when they go vacant.
Reports from UPSers
Teamsters in Los Angeles, Atlanta, Sacramento, Spokane, New York, Cincinnati, Orange County, Calif., Toledo, Seattle, Memphis, Baltimore, Roanoke, Va., Little Rock, North Carolina and other local unions report that the company has created few, if any, full-time Article 22.3 jobs since Aug. 1 of last year.
When combo jobs are vacated, they say management will delay posting the position, and when possible, not fill the job at all.
Stewards in Seattle Local 174 report that management has eliminated 10 percent or more of the full-time combination jobs in the Redmond Hub alone by refusing to fill vacant positions.
In a few cases, members report that combo employees have been laid off.
UPS managers and even some Teamster business agents have claimed that the company has the right to eliminate combo jobs because of “loss of volume.”
No language exists in the contract to back up this claim. In fact, this argument was specifically rejected by an arbitrator when the company tried to use it to back out of its obligation to create full-time jobs after we won the 1997 strike.
In some cases, management claims that it has relocated the full-time jobs to other locals. But our follow up investigations into these locals indicate otherwise.
Thousands of Missing Full-Time Jobs
We don’t know exactly how many Teamsters UPS is cheating out of a full-time combination job. Reasonable estimates climb into the thousands. Management has created few of the 2,500 full-time jobs it was required to fill in the year ending Aug. 1. Include the jobs that have been allowed to go vacant and the numbers add up fast.
But there is no reason that stewards have to wonder. Our contract gives our union a powerful tool for enforcing our right to 20,000 full-time combo jobs.
Article 22.3 requires the company to give the International Union a list that details and identifies all 20,000 combo jobs the company will maintain. The contract says that UPS had to turn this list over to the IBT sixty days after the contract was ratified.
That was more than five months ago. But as we go to press, the International Union has never provided this list to local unions, making contract enforcement much more difficult.
What the IBT Can Do
Our International Union needs to act now to stop UPS’s full-time jobs takeaway. The Parcel Division must launch an immediate and comprehensive nationwide audit of Article 22.3 jobs.
Each local union should be provided with a list of the Article 22.3 jobs that UPS claims it is maintaining. Business agents and shop stewards could then compare the company’s list with the full-time jobs that are actually filled in the local union.
Grievances can be filed locally and the Parcel Division could file a national grievance to demand that UPS immediately post all vacant positions until at least 20,000 combo jobs are filled.
Eligible Teamsters who were denied access to a combo position by the company’s violation of the contract should receive full back pay.
Failing to create and fill full-time jobs saves the company many millions of dollars a year. This money belongs in the pockets of the working Teamsters who have been cheated out of their full-time job. Only by demanding backpay will we give the company a financial incentive to follow the contract.
What Members Can Do
Concerned Teamsters are taking action to protect full-time jobs. You can too.
Make a list of all the full-time combo jobs that have gone vacant and not been filled in your building.
File a grievance. Your grievance should state that the company is violating Article 22.3 of the contract by failing to create and maintain 20,000 full-time jobs nationwide.
Your remedy should state that the company should cease and desist from violating Article 22.3, immediately post and fill all vacant Article 22.3 positions, and make affected Teamsters whole in every way including but not limited to restoration of full-time job opportunities and full backpay.
Ask your local union to get UPS’s Article 22.3 full-time jobs list from the Parcel Division and to share it with members and stewards so the contract can be enforced.
Your local union can also file an information request. Federal law requires UPS to comply with a request from the local for the list of jobs that UPS is maintaining in the local’s jurisdiction under Article 22.3.
For advice and a sample grievance and information request, call Teamsters for a Democratic Union at 313-842-2600 or go to www.MakeUPSDeliver.org
Together, we can make UPS deliver the 20,000 full-time jobs they owe us.
Minneapolis Members Weigh Cuts at Star Tribune
August 1, 2008: As Convoy goes to press, Teamster drivers, pressmen, and mailers at the Minneapolis Star Tribune are facing separate proposed contract reopeners that would cut their wages by 10 percent.
The three new contracts are supposed to help the newspaper financially. But some members are suspicious, especially because the company has been making statements this year that it is solvent and making good profits.
The new deal was negotiated in secret, with International rep Brad Slawson leading the talks. Rank-and filers have been distributing leaflets, urging a No vote.
Two years ago the private equity firm Avista bought the Star Tribune. Now the union is warning that the paper may go bankrupt if workers don’t accept the cuts. There have been rumors of bankruptcy circulating in the media, but the publisher Chris Harte has been denying them.
“We are a strong and profitable company,” he told employees in February.
In July, the newspaper withheld a quarterly interest payment to holders of second-tier debt, but Harte again publicly denied bankruptcy speculation, saying it was restructuring its debt plan with senior creditors.
Members of the elected bargaining committees from the three locals were kept out of the negotiations, and it’s been up to rank-and-file members to educate members about the details of the agreement.
“When members have asked questions about what’s in the agreement, our BA has told them to wait until the ratification meeting,” said Rick Sather, a Local 638 driver. “That’s just not acceptable when our jobs are on the line.”
Three different locals represent Teamsters at the paper: drivers are in Local 638, mailers in Local 120, and pressmen in GCC 1-M.
Members from all three unions, as well as other members of Machinists and the Newspaper Guild, have formed the Newspaper Workers Rank-and-File Solidarity Support Committee to give members an informed vote.
A flyer by the group, informing members about the concessions, says: “Concessions don’t save jobs.”
For the drivers, the new contract comes just one year into their four-year contract. The pressmen still have 28 months left on their contract, and the mailers 11 months.
This is the second time this summer Local 638 members have been asked to water down their agreement. In June the union asked members to give up their 20¢ raise slated to come in on July 1. Members voted unanimously not to vote on the offer, and they got the raise bump.
“Everyone knows the newspaper industry is having tough times, and members are rightfully worried about our jobs and our future. But our union has to be about more than just fear,” Sather said.
“Our job is to show that when we work together, we can have hope. That starts with keeping members in the loop.”
Local 804 Members Still Looking for Straight Talk on Benefits
August 5, 2008: Months after New York UPSers approved new bylaws for their local, members are still having trouble getting straight information about their benefits.
This spring, UPS Teamsters in New York Local 804 voted by over 90 percent to require the Local 804 Executive Board to provide members with information about their pension and health funds.
In July, the Local 804 Pension Fund finally responded to members’ requests for pension documents—and turned over some information, including reports from various investment managers.
But the fund continues to violate federal law by refusing to turn over the most important documents that members requested—including the Actuarial Valuation Report and other actuarial reports, despite a specific request for this information from members’ legal counsel.
Members are legally entitled to these documents. Every other major Teamster fund has provided this information to members within 30 days or less—sometimes without charge.
In contrast, the Local 804 Pension Fund not only refused to turn over documents, it even charged members for documents it refused to provide. Local 804 shop steward Tim Sylvester was billed more than $125 for pension documents—but more than 25 percent of these documents were missing!
Sylvester and other leaders of Local 804 Members United are following up with the fund through their legal counsel, attorney Ann Curry Thompson.
Concern Over Health Benefits
Local 804 members are also still looking for straight answers about the Local 804 Health Fund and the future of members’ health benefits and retiree healthcare.
An investigation by Local 804 Members United revealed that the Health Fund lost $18 million over four years—according to the fund’s own financial reports.
Their investigation also revealed that Local 804 officials voted to reduce UPS’s contributions to the Health Fund and divert the money to the Pension Fund—a move that accelerated the Health Fund’s multi-million dollar losses.
Local 804 officials have responded by telling members that the Fund did not “lose” $18 million; it just “spent” $18 million more than it took in! Accountants call that losing money—and so do the fund’s own financial reports.
Local 804 members deserve more than word games—especially when their health benefits and retiree healthcare are at stake.
No one has suggested that the fund’s money mysteriously disappeared! Leaflets can be downloaded at www.804membersunited.org that explain how the fund’s losses occurred.
What Local 804 members want to know is whether the money that was negotiated under the new UPS contract will be enough to rebuild the Health Fund’s depleted reserves and maintain current health benefits without cuts, increased co-pays or hikes in the cost of retiree healthcare.
Local 804 and UPS promised members in a signed a memorandum of agreement that 70¢ out of the $1.00 negotiated for benefits in the first year of the contract will go to the pension fund.
That leaves only 30¢ for the Health Fund, not much money to cover protect the benefits of members and retirees and rebuild the fund’s reserves.
Is Baltimore Pension Fund Driving Blind?
August 6, 2008: Ever since the Baltimore Local 355 fund cut the pension accrual rate to zero, members have been asking why the cuts happened, and what the local is doing to restore the cuts.
Now their fund is telling them it won’t answer their questions. But members aren’t taking No for an answer.
In February, Local 355 President Denis Taylor said the fund would be in the Red Zone, the worst funding level, if he didn’t cut the accrual rate to zero. Members have had their pensions frozen since the cuts took effect on March 1.
Now the fund is officially in the Green Zone, the highest level. But how it got there has never been explained to members.
Rank-and-file members in Local 355 have obtained the actuary’s report that recommended the cut. What the report does not say: how big the cuts should be, how long they should last, or how the cuts will affect the fund.
When members requested an explanation of how the cuts are affecting the fund, the fund administrator refused to disclose their projections. The fund said they already answered members’ questions.
“They say they’ve told us everything we need to know, but they haven’t told us when our benefits will be restored,” said Keith Reinhard, a Local 355 DHL delivery driver. “Our pension fund is either keeping members in the dark—or they’re driving blind.”
Pension Protection Act
Rumors are circulating in the local that the Pension Protection Act, the new pension law that took effect on Jan. 1, forced the fund to cut the accrual to zero.
But the new law does not mandate cuts. The PPA requires funds to declare if they are in the Red Zone, Yellow Zone, or Green Zone, based on their funding level and other factors.
The law also requires funds in the Red and Yellow Zones to create a plan to get above 80 percent funding in 10 years.
Plans in the Red or Yellow Zones do not have to cut benefits. The Central States Pension Fund announced earlier this year that it was in the Red Zone, but assured Teamster members that no further cuts were planned.
“Like politicians, our officials have gotten comfortable with a long term in office and they think they can just sail through,” said Reinhard. “They need to be held accountable for their actions and deal with the problems in front of them.”
Pension Bill of Rights
Members of Local 355 have launched a petition campaign to win a Pension Bill of Rights to protect their benefits. The Bill of Rights includes:
- The right to be informed and to get regular updates about their fund.
- The right to an accrual and an end to the pension freeze.
- The right to have a say if cuts are needed.
The movement is catching on. “I met some other members before my shift one morning and asked other drivers to sign the petition,” reports Kenny Walker, a UPS package car driver at the Hunt Valley building.
“We got over 120 signatures in a little over an hour. Only two people we saw wouldn’t sign—and one of them was late and running to get in the building.”
Since the cuts, TDU members in the local started distributing more Convoys and special pension bulletins. TDU has lined up attorneys to help members obtain important plan documents from the fund. And TDU organized an informational meeting to give members the facts about the new pension law and their benefits.
“It’s because of TDU that we’ve been able to get information from our fund and get it out to members. Now our job is to make that network even bigger.”
Kansas City Rejects APWA for the Third Time
August 1, 2008: UPS Freight Teamsters in Kansas City have rejected the Association of Parcel Workers of America for the third time by a vote of 157-58. This outfit is a wrong turn down a blind alley for Teamsters who want positive change.
Chicago Local 705 Contract Negotiations
August 1, 2008: Little progress has been made in negotiations for a new contract covering freight Teamsters in Local 705. Members overwhelmingly passed a strike authorization vote and lent their support to the bargaining committee.
However representatives for Yellow, Roadway, Holland, and ABF are stonewalling the union. The next negotiating sessions are scheduled for August 5 and 7. Updates are posted at www.teamsterslocal705.org.