House committee approves FAA funding bill without FedEx labor provision
Final version of multiyear funding bill omits controversial language that would change FedEx's labor status.
The House Transportation and Infrastructure Committee late Wednesday approved a four-year, $59.7 billion Federal Aviation Administration (FAA) funding bill that excludes a controversial provision that would change the labor law governing FedEx Corp.'s air express unit.
The 34-25 vote would seem to end legislative efforts to reclassify FedEx Express as operating under the National Labor Relations Act (NLRA), the law that covers virtually all U.S. industries, including trucking. Throughout its history, the unit has been governed by the Railway Labor Act (RLA), a labor statute that applies only to the airline and railroad industries.
In 2009, then-Congressman James L. Oberstar (D-Minn.), who chaired the House committee at the time, introduced legislation requiring all FedEx Express employees except for pilots and aircraft mechanics to be covered under the NLRA. The provision was supported by the Teamsters union, which wanted the largely non-union division to be covered under a law considered an easier path to unionization, and by FedEx's chief rival, UPS Inc., which is covered under the NLRA and argued that the FedEx unit's ground service workers, who may never touch an aircraft, should be covered by a statute that governs the trucking industry.
FedEx cited administrative and judicial rulings that its air service and the trucking operations that support it are essentially a single airline unit, and that, unlike the UPS structure, the FedEx Express trucking operations are totally dependent on its air business. FedEx also argued that the NLRA gives labor unions the power to call job actions within a city or a region, thus jeopardizing the reliability of the company's system-wide delivery operations.
FedEx said the change could trigger a $5 billion "hidden package tax" on shippers and consumers by forcing FedEx to implement costly contingency plans to deal with local work stoppages that could have a ripple effect across its network.
Frederick W. Smith, FedEx's chairman and CEO, warned that any change in the law would lead the company to cancel orders for up to 30 Boeing 777 freighters. The company insists that Smith's warning was not an idle threat.
Legislative wrangling over the provision was one of the factors that kept Congress from moving forward on a multiyear FAA funding bill. The agency has been surviving on a series of 17 short-term funding extensions since the last reauthorization law expired in 2007.
Over time, however, whatever congressional backing that had existed for the provision began to evaporate. The Senate Commerce Committee, which oversees transport legislation in the Senate, did not include the language in its version of an FAA funding bill. Meanwhile, House committee members have chafed at the notion that a provision not considered central to air operations was delaying progress toward funding important air safety measures. As one of its final acts before taking a 10-day recess in mid-February, the full Senate passed the committee's version.*
The provision's fate may have been sealed on election night in 2010 when Rep. Oberstar, who had become the language's lone supporter, was defeated in his bid for re-election. His successor as committee chair, Rep. John L. Mica (R-Fla.), showed little interest in the provision and was willing to jettison it in order to pass an FAA funding bill.
The legislation is H.R. 658, the "FAA Reauthorization and Reform Act of 2011." It was introduced by Rep. Mica and by Rep. Tom Petri (R-Wis.), chairman of the House Subcommittee on Aviation.
*The original version of this article, posted on Feb. 17, 2011, did not include this sentence.
About the Author
Executive Editor - News
Mark Solomon joined DC VELOCITY as senior editor in August 2008, and was promoted to his current position on January 1, 2015. He has spent more than 30 years in the transportation, logistics and supply chain management fields as a journalist and public relations professional. From 1989 to 1994, he worked in Washington as a reporter for the Journal of Commerce, covering the aviation and trucking industries, the Department of Transportation, Congress and the U.S. Supreme Court. Prior to that, he worked for Traffic World for seven years in a similar role. From 1994 to 2008, Mr. Solomon ran Media-Based Solutions, a public relations firm based in Atlanta. He graduated in 1978 with a B.A. in journalism from The American University in Washington, D.C.
More articles by Mark B. Solomon
- Transport déjà vu beckons as EC launches in-depth probe of FedEx-TNT deal
- For UPS, Coyote purchase is all about smoothing out the network wrinkles
- Senate passes six-year transport funding plan with new freight, multimodal initiatives
- UPS expands "Access Point" network to add 100 U.S cities by end of summer
- eBay shuts down same-day delivery service
Join the Discussion
After you comment, click Post. If you're not already logged in, you will be asked to log in or register.
Feedback: What did you think of this article? We'd like to hear from you. DC VELOCITY is committed to accuracy and clarity in the delivery of important and useful logistics and supply chain news and information. If you find anything in DC VELOCITY you feel is inaccurate or warrants further explanation, please ?Subject=Feedback - : House committee approves FAA funding bill without FedEx labor provision">contact Chief Editor David Maloney. All comments are eligible for publication in the letters section of DC VELOCITY magazine. Please include you name and the name of the company or organization your work for.