With a little more than three weeks to go before the threatened date of a strike by UPS workers arrives, companies that depend on the country’s largest package carrier have been considering their plan Bs.
Teamsters leaders representing 340,000 UPS employees have already announced tentative agreements for a new five-year labor contract, addressing in-vehicle air conditioning, workforce structure and more. But a blanket deal has yet to materialize, and the company and union have been trading barbs since negotiations broke down after the long Fourth of July weekend.
Salary for part-time employees remains a sticking point, Teamsters President Sean O’Brien told MSNBC Friday morning, although, he said, “we have reached an agreement on most of the terms.”
As the clock ticks toward Aug. 1, the date union workers threatened to walk out after voting last month to authorize a strike, some UPS customers are planning possible disruptions.
“I feel sad for the UPS workers because I want them to get paid and they do a good job … but it’s definitely scary,” said Heather DeVal, owner of a clothing and home goods store called Sunshine Soul in Annapolis, Maryland. It uses the carrier for about 40% of its total shipments, but for almost all of its wholesale orders, which generated about 70% of its revenue last year.
If UPS workers go on strike next month, DeVal said he would lean more on the US Postal Service and FedEx, but finds UPS the most convenient and reliable option in his area. “Just for wholesale, the shipping cost would probably be double,” he said.
Other business owners expressed less urgency to line up alternatives.
Toybox, an Oakland, Calif., company that makes devices for 3D printing toys, relies “very much” on UPS, said director of operations Malcolm Bird, but isn’t worried about finding another carrier.
“We’re going to be able to ship, it’s just that we’re going to have to use someone else,” he said.
Left Coast Original, a laser engraving company in Largo, Florida, uses UPS for 99% of its packages, which range from custom charcuterie boards to monogrammed wallets, which totaled about 70,000 last year, founder Aaron said. Bornfleth. He is waiting to see how the labor talks play out in the coming weeks before diverting the packages to another carrier.
Even if we were proactive in putting together a mitigation plan for switching to FedEx, everyone else would too.
Original Left Coast Founder Aaron Bornfleth
“We will have to jump from one lily pad to another as the situation develops,” he said. “Even if we were proactive in putting together a mitigation plan to switch to FedEx, everyone else would too.”
A FedEx spokesman said the company was working to accommodate customers looking to move their shipment to the carrier, but noted a statement issued Thursday urging potential newcomers to act fast. The spokesperson cautioned that, like other carriers, FedEx faces limits on how much additional volume it can handle in the event of a UPS strike.
For companies in more remote areas, securing an alternative might not even be a possibility.
Jaclyn Wilson, co-owner of Flying Diamond Beef in western Nebraska, ships all of her company’s perishable packages via UPS. When she ships by air, she requires a five hour drive to Denver.
“In our case [a prolonged strike] it would shut us down because we can’t really use any other provider here,” he said. “We would only be able to deliver per person and we would not be able to ship until this is resolved.”
No date has been set for UPS and the Teamsters to resume negotiations, and few details have emerged publicly about the remaining disputed issues, which O’Brien has characterized as economic.
“It could be that this is theater, and both sides are trying to get every last possible advantage to squeeze every last dollar available” before disclosing a contract agreement, said Seth Harris, a professor of law and politics at Northeastern University who was He served as President Joe Biden’s top labor adviser until last year. “Or it could be that they’re at a real dead end where their positions don’t overlap and they’re trying to figure out what to do.”
While UPS has consistently emphasized its August 1 strike deadline, some labor experts say the union can extend its existing contract beyond its July 31 expiration date at its discretion. That could buy rank-and-file workers time to vote on a new deal should it meet in the last days of July or even later.
It could be that this is theater, and both sides are trying to get the last possible advantage to get the bottom dollar available.
Prof. Seth Harris, North Eastern University
When asked about that possibility, a union spokesperson said, “Extensions and concessions were granted by the previous Teamsters administration, but those days are over and UPS must face this reality.”
A work stoppage at UPS would be the largest single employer strike in US history. Logistics experts say even several days of grounded UPS deliveries would likely disrupt the flow of more packages than major rivals like FedEx or USPS could absorb, threatening to upend the back-to-school shopping season.
Even so, retailers have been coming up with backup plans for “quite some time,” said Jess Dankert, vice president of supply chain for the Retail Industry Leaders Association, a trade group that represents major brands like Walmart and Target. .
Many companies had already diversified their delivery providers and added smaller, regional carriers during the pandemic surge in e-commerce, Dankert said, adding that retail supply chains “are designed to be flexible and resilient.”
“In the worst case of a strike, there would certainly be disruptions, but hopefully those contingency plans will mitigate any of the more significant impacts,” he said.
After the latest collapse in talks, UPS touted its “industry-leading payment” in a statement this week, saying it was proud of its offer and the Teamsters “should come back to the table.” Union representatives criticized the company for saying it “had nothing more to give” and reiterated that the employees would not work beyond the expiration of their current contract.
