September 18, 2013

Largest Teamster local in UPS system urges rejection of supplement to national contract

Local 89 in Louisville upset with proposed health coverage; aims fire at union's lead negotiator.

By Mark B. Solomon

The largest Teamster union local representing UPS Inc. workers has urged its 9,300-member rank and file to reject a regional contract supplement that must be approved before a national parcel compact narrowly ratified in late June can take effect.

Members of Local 89 in Louisville, Ky., which represents air and ground workers at UPS's global air hub, met Sept. 7 to review, and ultimately rebuff, a renegotiated version of the regional supplement, according to a statement on the local's website. Members in attendance said at the time they would try to convince their union brethren to vote down the supplement when they received their ballots, which were mailed today.

The tone of the statement reflects the local's continued dissatisfaction with the language in the supplement and with the efforts of the union's national leadership. It reserved its harshest comments for Ken Hall, who heads the package unit and leads the contract talks. The local called Hall "out-of-touch and unresponsive," adding that members will not make "needless concessions" in order for Hall to appease UPS. The local criticized national negotiators for making only "token efforts" to improve the supplement's language.

In June, the local voted to reject the master agreement by a 3,388-to-483 margin, and to rebuff the supplement by a 3,520-441 margin. The five-year master contract covering about 235,000 small-package workers was ratified by 53 percent of the voting members, the narrowest margin of approval since the two sides began negotiating nationwide compacts in the late 1970s. UPS-Teamster contracts date back to the 1930s, but for decades, they were negotiated at the regional and local levels.

In addition, the rank and file rejected 18 regional and local addenda to the national contract; these are known as either "supplements" or "riders," depending on the locations of workers in the UPS system. That is believed to be the largest number of such compacts rejected in any contract negotiated by the Teamsters in its 110-year existence.

Because the national, regional, and local elements are part of one overall agreement, a master contract cannot go into effect until all supplements and riders are ratified by the affected regions. A second rejection means both sides return to the bargaining table. A third rejection allows for a strike authorization vote to be taken. At this time, only one regional supplement, covering a relatively small group of workers in upstate N.Y., has been ratified.

Ballots were also mailed today to workers in New York City, Philadelphia, and Detroit, as well as to other members in Michigan and Ohio. All ballots must reach the post office in the Washington, D.C., suburb of Lanham, Md., by Oct. 9 in order to be counted.

The small-package contract and a separate agreement governing about 12,000 workers at UPS's less-than-truckload (LTL) division, UPS Freight, expired July 31. The situation is in limbo at UPS Freight, where union voters rejected their five-year contract proposal outright by a 4,244-1,897 margin.

AT ODDS OVER HEALTH BENEFITS
Earlier this month, the union unveiled what appeared to be improved health benefits covering 140,000 UPS small-package workers who, under terms of the master contract, will transition on Jan. 1 from a company-sponsored plan to a program known as "TeamCare," a plan co-administered by UPS and the union. The plan represents the health care interests of UPS Teamsters in the central region.

Under the new plan, UPS Teamsters will pay no premiums, no deductibles until the last year of the contract, and in many cases, no co-payments for medical, prescription, vision, dental, life, and disability insurance, according to several sources. There is no annual cap on the medical benefits that can be used, and the out-of-pocket ceiling of $2,000 per family is actually considered better than what was offered under the UPS company plan, according to the sources.

In the online statement, Local 89 officials acknowledged that the new plan is an improvement over the previously negotiated version. However, they said the new plan still doesn't go far enough to address members' issues or to serve as an equivalent to the current UPS plan. The local seemed especially upset over the creation of what it called a "two-tier" structure, where part-time and new full-time enrollees will have better benefits than existing members. The local said that "no UPS worker should receive lesser benefits to its fellow members."

Ironically, UPS and Teamster leaders began talks nearly a year earlier than usual in hopes of reaching an accord long before the July 31 deadline for both compacts.

About the Author

Mark B. Solomon
Senior Editor
Mark Solomon has spent 25 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. Mr. Solomon graduated in 1978 with a B.A. in journalism from The American University in Washington, D.C.

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