Teamsters Trade Gains of 1997 UPS Strike for Deal to Organize Members at Freight Division

Editor’s Note: While a two-thirds majority of UPS Teamsters approved the national contract, three supplemental agreements in the Eastern region were rejected. Under the Teamster constitution the national contract cannot be ratified until all of the supplements have been approved.

In mid-November Teamsters (IBT) at United Parcel Service approved a controversial five-year agreement, more than eight months before the expiration of their current contract.

The new contract will pull 44,000 Teamsters out of the union’s multi-employer Central States pension plan, and end conversion of part-time into full-time jobs at UPS. It also widens the gap between full-time and part-time standards, freezing part-timers’ starting pay and forcing new part-timers to work for a year before they are eligible for health care coverage.

These givebacks were accepted in spite of the company’s healthy bottom line, UPS reported more than $4 billion in pre-tax net income last year.

Negotiators traded these concessions, along with several others, for solid annual increases in the wage and benefits package for full-time workers, as well as bargaining rights at the company’s non-union freight division UPS Freight, which was created when UPS acquired Overnite Transportation two years ago.

LESSONS FORGOTTEN?

The current deal differs markedly from the contract secured during the 15-day strike against UPS 10 years ago. The 1997 strike—built and sustained by an activated rank and file—captured national attention and scored one of labor’s biggest victories in decades.

The union built an 18-month contract campaign in the run-up to the 1997 strike, keeping rank-and-file members informed about the status of negotiations and involved in building pressure on the company. The differences between 1997 and 2007 have not been lost on some veteran activists.

“We were in the dark throughout the whole process,” said Al Williams, a UPS driver in Van Nuys, California. “Then we get this deal and it’s like ‘hurry up and vote!’ I got four mailers from the union and the company, and the supervisors at work are running around telling us we should vote ‘yes’ on the contract.”

“We worked so hard in 1997,” exclaimed Toni Jackson, a full-time driver and steward in Local 667 in Memphis, Tennessee. “This contract is a slap in the face.”

Michael Savwoir, a UPS driver in Kansas City, Missouri and Teamsters for a Democratic Union (TDU) leader, said: “UPS lost the strike in 1997 and they’re sore losers. The gains made in 1997 are being given back in 2007, with interest.”

STEPPING BACKWARDS

The most important feature of the new contract is a green light for UPS to pull 44,000 full-time workers out of the Central States pension plan. In exchange for a $6.1 billion pre-tax cash infusion into the Central States Pension Fund, UPS can create a new jointly administered company plan.

This move pulls nearly a third of the active Teamsters out of the Central States fund, which has been shaken by funding shortfalls and benefits cuts in recent years. Under the new agreement, pension benefits will be frozen at levels negotiated during the 1997 contract, and accrual rates in the new plan will be much lower than those in other IBT pension funds.

This contract also opens the door for UPS to expand its low-wage part-time workforce, breaking the pattern established during the 1997 strike that required the company to create 10,000 new full-time jobs by combining 20,000 part-time positions. The current deal diminishes long-term prospects for many part-timers at UPS by creating no new full-time jobs out of combined part-time jobs—often their avenue to full-time employment.

New part-timers will also have to wait a year before they are eligible for individual health benefits, and 18 months for family coverage. New hires will no longer have vacation, sick days, or paid holidays during their first year. The new contract also freezes starting wages for part-timers at $8.50 over the life of the agreement.

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For many rank-and-file activists this represents a giant step backwards from the 1997 strike, where the theme “Part Time America Won’t Work” garnered widespread public support.

“That strike was for part-timers,” Jackson said. “But now they’re sneaking back in the door. We need to get the big picture. Are we going back to part-time America?”

Williams agreed: “This contract really hurts the part-timers. I mean the minimum wage in California is going to be higher than $8.50 pretty soon. That really says something about this company that they would pay people so little.”

TRADING FOR NEW MEMBERS

On the positive side of the balance sheet, ratification of this agreement paves the way for organizing 12,000 non-union workers at UPS Freight. Last year the union won a “card check” agreement at the UPS Freight’s Indianapolis terminal, and has since bargained and ratified a contract for the 125 employees in that location.

According to Teamsters Vice President Ken Hall, who spearheaded negotiations, the company has agreed to card check for all of UPS Freight if the UPS parcel contract is ratified. The union reportedly plans on using the Indianapolis contract as a template for the rest of UPS Freight.

But the UPS Freight agreement, which contains standards far below the National Master Freight Agreement (NMFA), is already creating problems for other freight Teamsters. Last year William Zollars, the CEO of Yellow Roadway, told Traffic World magazine that any deal between the Teamsters and UPS Freight would “set precedent” for the NMFA.

Early reports from NMFA negotiations indicate that the companies are pushing for the weaker standards contained in the UPS Freight contract.

Allowing an individual contract to pull down a master contract’s standards bucks tradition in the Teamsters, Savwoir said. “The irony of the whole thing is that Hoffa Senior was responsible for the strength of our national agreements,” he said, “and now Hoffa Junior is decimating them.”

MAKE UPS DELIVER

This year’s contract talks continued a pattern started in 2002, where the union kept details of their negotiations largely under wraps until a final deal was reached.

“In 2002 we got very little information about negotiations,” noted Dianne Bolton, a UPS driver from Local 174 in Seattle. “We called it a ‘brown-out.’”

This year, Bolton along with many other rank-and-file Teamsters, helped organize a grassroots contract campaign, Make UPS Deliver. Led by TDU, this campaign provided one of the only sources of information during negotiations.

Once the tentative agreement was reached, Make UPS Deliver became a center of “vote no” activity for members who were convinced the company had not put its best offer on the table.

According to Bolton, opposition to the contract went hand-in-hand with members’ desire to build a strong union.

“Instead of bringing us together they divided everyone. They got members thinking ‘me, me, me,’” Bolton said. “I think where people got our information and asked the question ‘how are we doing,’ they were unhappy with this contract.”

After the vote, activists said much work remains to be done. “We need to continue the education process, and try to expand the network we built,” Bolton said. “I think Make UPS Deliver will keep going, and we’ll build off of it, with contract enforcement tools and other information people will need when they start to live under this contract.”