UPS Inc. has reached new labor agreements with workers in its air and freight transportation operations, the company said.
The parcel carrier on Aug. 14 said it has reached a tentative agreement to extend for five years its contract with 1,300 airline mechanics and other UPS Air Cargo employees represented by the International Brotherhood of Teamsters Local 2727, headquartered in Louisville, Ky.
“UPS is pleased that the Teamsters Local 2727 and company negotiators have reached a tentative agreement to amend the contract for another five-year term for our airline mechanics,” UPS said in a statement. “We believe the proposed contract meets the needs of our employees and business by rewarding employees with industry-leading pay and benefits, while also providing enhanced flexibility, positioning UPS to meet customer needs, while also addressing competitor challenges.”
In a Aug.14 statement provided to Transport Topics, the Teamsters said employees will get an immediate 16% pay hike, along with annual 3% raises. The union said salaries will have increased by 30.7% when the contract is next amendable. Workers also will get retroactive pay for all hours worked dating to Nov.1, 2013, when the contract first became amendable. Under the Federal Railway Labor Act, airline and railroad union contracts do not expire, they become amendable.
The next step is to take the contract to the membership for a vote, which the two sides expect to happen within the next few weeks.
“We are eager to share the details of this top-notch agreement with our members and our families who will now have the top-notch pay and health benefits we’ve been fighting for. We believe the contract will be ratified swiftly,” said Jack Chatburn, a Teamsters bargaining committee member and airline mechanic.
Separately, on Aug. 9, local union leaders with the Teamsters, which represents UPS Inc. and UPS freight workers, approved two separate five-year national contracts. This paves the way for 250,000 workers — including drivers, loaders, package sorters, dockworkers and operations team members — and 11,000 freight workers to vote on the contacts in September.
“UPS is pleased that Teamsters leadership throughout the country have approved the small-package and freight tentative national agreements,” the parcel delivery company said in a statement. “The next step involves a ratification vote by the membership. We believe these contracts meet the needs of our employees and the business. They reward employees for their contribution to UPS’ success through wage increases, benefit improvements and the creation of thousands of new full-time jobs. They also include provisions that give UPS greater flexibility to meet customer needs for expanded weekend residential services, as well as address challenges from competitors.”
Denis Taylor, co-chairman of the Teamsters National UPS Negotiating Committee, added that the vote “was a very strong indication of the support nationwide from local union leaders, and it sends the national agreement, regional supplements and riders to the members for a ratification vote.”
For current drivers, the new contract calls for a $4.15-per-hour raise over the life of the agreement, which eventually would bring a driver’s base salary up to more than $83,000 a year. The union said full-time UPS drivers now earn on average nearly $75,000 a year, or $36 an hour.
There are salary increases for part-time workers, and workers will continue to receive their health insurance without paying premiums.
UPS and the union said they agreed to create 5,000 full-time jobs during the life of the contract, including a minimum of 2,000 sleeper team jobs by taking work off from freight railroad and onto trucks. The sleeper driving jobs will be among the company’s highest paid, reaching 96 cents per mile in 2022 for three-driver trucks. There also will be a new combination driver classification that addresses the changes brought on by e-commerce.
The agreement creates a new class of “hybrid drivers” who work weekdays and weekends but whose pay would top out after five years at $34.79 an hour, or more than $72,000 a year. Adding these drivers addresses union concerns about overtime in the event UPS adds Sunday delivery to its Monday-to-Saturday schedule. The carrier added Saturday service more than a year ago.
The union said for UPS Freight workers, the tentative contract addresses numerous major issues, including subcontracting, wage increases, pension increases, seniority, bidding, penalty pay and more paid leave for casual employees.
“The UPS Freight tentative agreement provides our members with economic security and job security over the next five years and beyond,” said Kris Taylor, the Teamsters’ UPS Freight coordinator.
According to the tentative agreement, the economic issues in the contract will be retroactive to Aug. 1, but other items will take effect after ratification.
Next month, members will receive the voting information they need to cast ballots. Members will vote by secret ballot via the internet or phone. They will have an individual access code and instructions how to cast their ballot.
UPS ranks No. 1 on the Transport Topics Top 100 list of the largest for-hire carriers in North America.