(New York) Delivery specialist UPS on Tuesday reached a contractual agreement with its 340,000-strong union, averting a strike that would have had the potential to disrupt nationwide logistics for businesses and households.
The deal was announced after UPS and the Teamsters returned to the bargaining table Tuesday to discuss remaining sticking points in North America’s largest private-sector contract. The two sides had already reached a tentative agreement on several issues, but remained at odds over things like the pay of part-time workers, who make up more than half of UPS workers represented by the union.
The Teamsters called the tentative agreement “historic” and “extremely lucrative” in a statement. It includes, among other benefits, higher wages and air conditioning of delivery trucks.
The company said the five-year agreement covering employees represented by the American Teamsters was subject to vote and ratification by union members.
The union, which had long threatened to strike, bragged about “historic wage increases” for its members, saying full-time and part-time UPS Teamsters would receive US$2.75 more per hour in 2023 and US$7.50 more per hour over the life of the contract.
He added that the agreement included provisions to raise starting wages for part-time workers to US$21 an hour, from US$16.20 today. He also reiterated previous concessions he had won from the company, such as making Martin Luther King Day a full holiday for the first time and ending forced overtime on driver days off.
Teamsters members, angered by a contract they say was forced on them five years ago by union leadership, have clashed with UPS over pay as the delivery company’s profits have soared in recent years.
UPS profits have grown more than 140% since the last contract was signed, as the onset of the COVID-19 pandemic dramatically transformed the way households get what they need.
Union workers argued that they were the ones driving the growth of the Atlanta company and seemed determined to right what they saw as a bad contract.
The 24 million packages shipped by UPS on average per day represent about a quarter of the total package volume in the United States, according to global shipping and logistics company Pitney Bowes. As UPS puts it, that equates to about 6% of the country’s gross domestic product.
The union ratification vote will begin on August 3 and end on August 22.