By MATT OTT (AP Business Writer)
Contract talks between UPS and the union representing the company’s 340,000 workers broke down early Wednesday, with each side blaming the other for walking away from talks.
The Teamsters have imposed several deadlines on United Parcel Service negotiators to make their “last, best and final” offer to its unionized workers in recent days. Union officials said on Wednesday that UPS “left the negotiating table after presenting an unacceptable offer”, including on the economic package.
UPS told a different story. The package delivery company said it was the Teamsters who walked out of negotiations, “despite UPS’s historic offer that builds on our peak compensation.”
“We did not walk away and the union has a responsibility to stay at the table,” the Atlanta company said in a prepared statement.
Either way, the talks are deadlocked, with the end of the contract – midnight July 31 – fast approaching. UPS workers represented by Teamster voted to authorize a strike last month and union leader Sean O’Brien said last week that a strike was imminent.
The Teamsters say any tentative agreement would have to be approved by its national committee before being circulated and voted on by members. The union has said it will not negotiate after the current contract expires.
Shares of United Parcel Service Inc. fell 1.4%. Shares of rival FedEx edged higher.
The Teamsters make up more than half of the company’s workforce in the largest private sector contract in North America. If a strike does occur, it would be the first since a 15-day walkout by 185,000 workers paralyzed the company a quarter of a century ago.
UPS has grown significantly since then and has become an even more integral part of the US economy, with consumers relying on prompt delivery of most household essentials. Small businesses that rely on UPS could also be left searching for alternative shipping options if the company’s remaining workforce is unable to meet demand during a strike.
The company says it provides the equivalent of around 6% of the country’s gross domestic product. That means a strike would have potentially far-reaching implications for the economy, particularly the supply chain, which has just started to recover from pandemic-related entanglements.
Negotiations appeared to be progressing in recent weeks, with agreements in principle on a number of issues since the start of national contract negotiations in April. The parties agreed to scrap the two-tier wage system for drivers who work weekends and earn less money, which was a major sticking point.
The union also said it also reached a tentative agreement to establish Martin Luther King Jr. Day as a full holiday for the first time and end unwanted overtime on driver days off.
Last month, the union and the company reached another agreement in principle to equip more trucks with air conditioning equipment. Under the agreement, UPS said it would add air conditioning to small U.S. delivery vehicles purchased after Jan. 1, 2024. Existing vehicles would not benefit from this upgrade, but the union said they would have d other additions like two fans and air vents.
UPS’s annual profits over the past two years are nearly three times what they were before the pandemic. The company returned about $8.6 billion to shareholders through dividends and share buybacks in 2022, and plans another $8.4 billion for shareholders this year.
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Haleluya Hadero contributed to this report from New York. Ott reported from Silver Spring, Maryland.
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