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Striking Big Brown

UPS might be the next target of the national strike wave — but under very unusual circumstances.

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Will the historic strike wave that began with teachers in February hit the United Parcel Service (UPS) this summer?

UPS is today the largest private-sector unionized employer in the United States with nearly 280,000 Teamsters. That includes its package division — which employs nearly 260,000 workers and sports UPS’s famous chocolate brown delivery trucks — and its smaller freight division. National contracts for both divisions expire on July 31, and the Teamsters are negotiating the two simultaneously.

On May 2, they called a national strike authorization vote. On Tuesday, materials for the vote reached rank-and-file members’ doors. The vote comes in the midst of negotiations which will not only impact UPS workers and their families, but also the union’s ability to organize the burgeoning nonunion logistics industry in the future.

“Unusual Circumstances”

Only recently has the media taken a breather from its obsession with Amazon’s search for a second headquarters (HQ2) to pay some attention to the UPS negotiations. This was prompted by Teamster leaders’ announcement of the strike vote.

Teamster general president James P. Hoffa and Teamsters’ chief negotiator Denis Taylor informed members of the strike vote in a letter, saying,

Nobody wants a strike. It hurts the company and it hurts members. However, the ability to strike is necessary in order to ensure a timely and positive conclusion to negotiations. We have to show that we’re not afraid of striking.

As some local leaders pointed out, this wasn’t exactly a rousing call to action. Matt Taibi, the secretary treasurer of Rhode Island’s Local 251 complained that this note failed to provide “a message or set of issues that members should mobilize around.” As he explained,

Members know how they get treated by the company on a day to day basis, so a Yes strike vote to send a message should come as a natural reaction. But the union needs to set out a clear message to inspire a real fightback. Members need to make it clear they will not accept concessions and we need to unite to include the entire membership at UPS. Fighting for $15 for part-timers and against two-tier drivers is a big part of that fight.

UPS, for its part, dismissed the strike vote as “an expected action taken by most unions during contract negotiation.” Yet Hoffa and then-chief negotiator Ken Hall didn’t call for one during the last round of national and local negotiations in 2013. This was a clear signal to the company that there was little threat of a strike and that Hoffa and Hall would press hard for membership ratification of the proposed 2013 contract settlement.

Much to Hoffa and Hall’s surprise, there was widespread opposition to that contract. It passed with only a bare majority vote, and eighteen local contract supplements were voted down, many of them twice, and some of them three times. The resistance was driven by Fred Zuckerman, president of Louisville’s Teamster Local 89, along with the Teamsters for a Democratic Union, who teamed up to capture members’ latent frustration and channel it into a “Vote No” movement.

Eventually, a frustrated Hoffa unilaterally imposed the supplements on an unhappy membership, thus allowing the national contract to be implemented. This was a major contributing factor to Hoffa’s near-defeat in the 2016 Teamsters election to a reform slate led by Zuckerman, in coalition with Teamsters for a Democratic Union.

That near-defeat is likely why Hoffa called a strike vote this time around. But the circumstances of the vote are highly unusual.

As TDU argues, “Normally, a strike vote is called as a strategic move to build the union’s bargaining leverage. But Package Division Director Denis Taylor has not even been using the leverage he already has.”

That is a reference to the big concessions Taylor has already made in bargaining. On issues of new technology, harassment, and excessive overtime, Taylor has either given up; agreed to weak, meaningless language; or proposed givebacks himself.

For instance, Taylor proposed contract language that will create a new, inferior category of package delivery jobs at UPS. These  so-called “Hybrid Drivers” would deliver ground packages — still the core of UPS’s business operation — part time and at a lower pay scale.

It has been UPS’s goal for years to break up the full-time ground package delivery jobs. There are currently sixty thousand UPS full-time package car drivers in the United States, and they are among the shrinking number of driving jobs in the United States where you can still make a decent living supporting a working-class family.

Teamsters United called the hybrids “the worst giveback in UPS history.” In the aftermath, Denis Taylor removed three members of the UPS national negotiating committee: Avral Thompson, John Bolton and Matt Taibi. All three are opposed to the “hydrid-driver” proposal. Taibi and Thompson ran against Hoffa on the Teamsters United slate in 2016, with Thompson elected to the union’s general executive board as one of six regional vice-presidents.

As Local 25 president Sean O’Brien told the Wall Street Journal, “It’s unfortunate that these negotiations are some of the most important and it seems like this leadership is focused on [internal] adversaries.

O’Brien was himself fired by Hoffa as chief negotiator for UPS at the beginning of this year. He was a longstanding Hoffa ally who delivered a sizeable vote for the Hoffa slate in 2016. He was fired for reaching out to opposition leader Fred Zuckerman, who won 70 percent of the UPS vote in the 2016 Teamster election. O’Brien has subsequently found himself in opposition to Hoffa on a number of important issues.

But Taylor and Hoffa have also proven to be sensitive to public exposure of their dirty dealings in negotiations. According to the Freightwaves website, an anonymously quoted Teamsters spokeswoman contacted them and emphasized that the two sides “had not come to any agreement about hybrid drivers.”

Thrashing Around

If Taylor and Hoffa’s actions seem confusing, contradictory, and self-defeating, it’s because they are. The Teamster leadership is thrashing around responding to multiple and contradictory pressures, including mounting dissatisfaction in the membership, frustration among officers of the union, and pressure from UPS for more concessions.

The future of the Teamsters is on the line here in a logistics industry that’s been transformed by the rise of Amazon. For decades, the package delivery industry was dominated by the Big Three: UPS, FedEx, and the US Post Office. Amazon has disrupted all of that and is now one of the largest nonunion employers in the country, with a vast network of warehouses (“fulfillment centers”) and delivery drivers.

It took UPS ninety years for it to employ as many people as Amazon has put on its payroll in the last five years. It employs over 566,000 people worldwide, a big jump from 341,000 at the end of 2016. More people work at Amazon, for example, than live in “Albuquerque, New Mexico, (559,000) or Tucson, Arizona, (530,000) and by next quarter will likely pass Milwaukee, Wisconsin (595,000).”

The quick rise of a nonunion employer in a previously union-dominated industry is reminiscent of the deregulation of the trucking industry in the early 1980s, when the Teamsters were decimated in what had previously been their stronghold.

The Teamsters are in a precarious position. A bad contract will only make things worse. In the forefront of the Teamsters leaders’ minds should be not only vast improvements in wages, benefits, and working conditions at the fabulously profitable UPS, but also using this as the opportunity to forge a model contract for organizing Amazon and FedEx. Yet such a strategy seems farthest from their minds.

Instead, the union is doing the dirty work for the company. UPS was one of the pioneers of part-time work and two-tier wage structures. Starting wages at UPS have gotten so low that in many parts of the United States starting wages at Amazon are actually higher. All this does is undermine the very idea of a union — workers shouldn’t compete with one another in a race to the bottom but unite to raise working conditions across the logistics industry.

It has been an open secret for years that UPS wants to change the composition of their delivery work force by eliminating the highly praised but demanding full-time package car jobs. It desperately wants to create a more precarious Uber-like package workforce, delivering packages with golf carts or via part-time workers’ personal vehicles.

So far, the Teamsters have resisted going that far. Still, Taylor’s proposal for hybrid drivers should be seen for what it is — acting at the behest of UPS. It alone justifies a national “Vote No” campaign. Taylor and Hoffa, however, are likely to try sell it as a “solution” to the crushing overtime suffered by the beleaguered package delivery workforce.

What Next?

UPS Teamsters have largely been kept in the dark about contract negotiations, despite the best efforts of TDU and Teamsters United (TU), both of which are positioning themselves to launch a Vote No campaign.

The last round of ratification votes in 2012–13 certainly showed there is an audience for such a campaign. But the rank and file’s appetite for a fight will have been tempered by the experience of Hoffa imposing an unpopular contract the last time.

A recent contract settlement at ABF, a nationwide freight company with nine thousand drivers and dockworkers, could be a bellwether for the viability of a Vote No campaign at UPS. 58 percent of Teamsters at ABF ratified the national contract, but not without pronounced rank-and-file dissent. Opponents of the contract were successful in defeating supplements to the national contract in New England, Philadelphia, upstate New York, western Pennsylvania, the South and Carolinas, and Northern California.

The proposed ABF contract produced an unprecedented level of opposition to Hoffa on the executive board of the Teamsters. The six regional vice-presidents elected on the Teamsters United slate in 2016 were joined by Hoffa running mate Ken Hall, Philadelphia Teamster leader William Hamilton, and Boston Teamster leader Sean O’Brien, in voting against recommending the ABF contract to the membership. The contract’s wage and pensions concessions were points of particular contention. They drove Sean O’Brien to urge New England ABF Teamsters to vote the contract down.

Wall Street loved the deal, however. Wolfe Research, one of Wall Street’s most important research firms, reported to its clients that, “the details include low annual wage increases and a freeze in pension contributions. If the Teamsters vote to approve the tentative deal, we’d view it as positive for [ABF].”

Why was it ratified, then? Partly because of the lack of leadership coming from the Hoffa administration. If they had taken a militant position on the contract and prepared the union to fight, the outcome could have been very different. It seems ABF Teamsters are in the same place that UPSers were six years ago, with a large minority willing to vote against the national contract and vote down regional supplements, but not willing to strike right now.

Today, UPS is in an entirely different place. Big Brown is a company that has rarely, if ever, lost money. In the face of 9/11, the Great Recession, and vast changes in the logistics industry, it has made huge profits year after year. UPS even boasted that:

The number of UPS employees represented by the International Brotherhood of Teamsters (IBT) increased by about 42,000 (19 percent) in the past five years — even as private sector union membership declined across the United States.

TDU organizer Ken Paff told me:

Hoffa used the strike threat at ABF not against the company, but against the members, effectively saying, “If you reject this offer, we will call an immediate strike and you’re on your own.”  It’s a tactic used too often by labor officials eager to sell a deal to their members. In the process, they undermine union power. But at UPS, that may be an ineffective tactic. Thousands of UPSers that we are working with are ready to strike if necessary.

Two decades ago, UPS Teamsters were the heroes of the labor movement in a historic strike that many hoped would change the direction of labor. Six years ago large numbers of UPSers were willing to challenge Hoffa and his allies by repeatedly voting down contract supplements filled with concessions. This year, will the “Red State” rebellions of the teachers’ and University of California medical workers’ strikes help push forward a fight at UPS?

We’ll see. But this year has taught us that there is a new confidence among rank-and-file workers to fight and win. A relatively small number of activists working with established groups like TDU and Teamsters United can make a huge difference in the thousands of hubs in UPS’s sprawling empire in the United States, and change the terms of battle in the American workplace.