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UPS and Teamsters Poised to Resume Contract Talks

After negotiations broke down a couple weeks ago, negotiators for the union and United Parcel Service are set to return to the bargaining table next week in an effort to avoid a worker strike that would impact promo and reportedly cost the economy billions.

So you’re saying there’s a chance.

Promotional products professionals and, indeed, folks across industries have grown increasingly nervous of late as the likelihood of a strike by more than 340,000 unionized drivers and logistics employees for United Parcel Service (UPS) seemed to grow after negotiations to establish a new contract for the workers broke down a couple weeks ago.

Recent saber-rattling from the Teamsters Union, including picketing practice events, upped the anxiety that a work stoppage could commence as threatened on Aug. 1 if a new contract isn’t inked by July 31.

But as the deadline nears, talks between the Teamsters and UPS are now set to resume next week, raising the possibility that a strike may yet be avoided. The Teamsters said that UPS reached out to reopen lines of communication.

“As thousands of UPS Teamsters practice picket, rally and mobilize around the country, UPS bowed today to the overwhelming show of Teamster unity and reached out to the union to resume negotiations,” the Teamsters said in a statement.

UPS confirmed the negotiations are back on.

“We are pleased to be back at the negotiating table next week to resolve the few remaining open issues,” the company said in a statement. “We are prepared to increase our industry-leading pay and benefits, but need to work quickly to finalize a fair deal that provides certainty for our customers, our employees and businesses across the country.”

As of this writing, a firm date for the resumption of talks had not been established.

Despite the tension, there has been substantial progress in the negotiations, with UPS and the Teamsters reaching agreements on key issues, such as the corporation agreeing to install air conditioning in new trucks and abolishing a two-tier wage system for drivers who work weekends and make less money. Still, wages and benefits remain a roadblock. In particular, the union wants better pay for part-time workers.

Economic Impacts

UPS is the largest package delivery company in the world.

According to a study by the consulting firm Anderson Economic Group, a 10-day UPS strike would be the most expensive in at least a century. It would cost the United States economy about $7 billion, the study found, including $4.6 billion in losses for customers, $1 billion in lost wages and more than $800 million direct losses for UPS.

About
$7 Billion
Estimated loss to the U.S. economy if UPS workers were to go on strike for 10 days.(Anderson Economic Group)

While UPS has started training non-union temporary workers to pick up some of the slack in the event of a strike, the bottom line is that a work stoppage would likely lead to slower delivery times across the package delivery sector, supply chain upheaval and more costly shipping.

FedEx and other providers, including the United States Postal Service (even with its new Ground Advantage offering), likely wouldn’t have the capacity to handle all the UPS business that would come their way with expected efficiency levels, analysts have said.

Some business leaders have been hopeful that Congress and/or President Joe Biden’s administration will intervene to help avert a strike, as happened in contentious contract talks for West Coast port workers earlier this year and railroad workers last year. Still, some members of Congress have said they will not intervene. The Teamsters have asked the Biden administration to stay out of talks.

UPS is a partner in ASI’s Business Savings Program, which offers members exclusive deals. ASI leaders have been following the negotiations.

“While we respect the rights of workers to voice their concerns and take collective action, we also understand the difficulties faced by ASI members navigating what could become an economically challenging period,” said Timothy M. Andrews, president and chief executive officer of ASI. “We hope for a speedy resolution to contract talks and will continue to closely monitor the situation. If a strike were to occur, it will not affect our affiliate relationship with UPS and, once settled, ASI will continue to offer UPS shipping discounts through our ASI Business Savings Program.”