UPS, Teamster contract talks fall apart with each side blaming the other

Contract negotiations between UPS and a union representing the company's 340,000 workers broke down early Wednesday with each side blaming the other for walking away from talks.

Teamsters has imposed multiple deadlines for United Parcel Service negotiators to make their “last, best, and final” offer to its unionized workers in recent days. Union officials said Wednesday that UPS “left the negotiating table after making an unacceptable offer” to Teamsters members.

UPS tells a different story. The package delivery company said it was the Teamsters who abandoned negotiations, “despite UPS' historic offer built on our industry-leading salaries.”

“We haven't left yet, and unions have a responsibility to stay on the table,” the Atlanta company said in a prepared statement.

Whatever the case, talks are deadlocked with the end of the contract – midnight on July 31 – fast approaching. UPS workers represented by Teamster voted for the authorization of the strike last month and union chairman Sean O'Brien, said last week that a strike was imminent.

Shares of United Parcel Service Inc. down almost 2%. Rival FedEx shares rose slightly.

Teamsters represent more than half of the company's workforce in North America's largest private sector contract. If a strike occurs, it will be the first since a 15-day strike by 185,000 workers paralyzed the company a quarter century ago.

UPS has grown rapidly since then and become an even more integral part of the US economy, with consumers relying on fast delivery of their most important household items. Small businesses that rely on UPS may also be left looking for alternative delivery options if the company's remaining workforce cannot keep up with demand during a strike.

The company says it provides the equivalent of about 6% of the nation's gross domestic product. That means the strike will have potentially far-reaching implications for the economy, particularly supply chains, which are only just beginning to recover from the lockdowns associated with the pandemic.

Negotiations appear to be progressing in recent weeks, with tentative agreement on a number of issues since national contract talks began in April. The two sides agreed to remove the two-tier pay system for drivers who work weekends and earn less, which was a major issue.

The union also said it had reached tentative agreement on establishing Martin Luther King Jr. Day. as a full holiday for the first time and ending unwanted overtime work on a driver's holiday.

Last month, unions and companies reached another tentative agreement to equip more trucks with air conditioning equipment. Under the agreement, UPS said it would add air conditioning to small US delivery vehicles it purchases after January 1, 2024. Existing vehicles won't get that upgrade, but the union said they will have other additions such as two fans and air vents.