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UPS Reaches Tentative Contract with Unionized Workers

July 25, 2023

UPS Reached a Tentative Agreement with 340,000 Union Members

The first day that the Teamsters union and UPS returned to the table after negotiations broke down has resulted in a tentative contract agreement with the 340,000 members of the union.  This potential strike would have been very disruptive to shippers nationally along with other carriers that would have provided auxiliary capacity.


President Biden released a statement: "This agreement is a testament to the power of employers and employees coming together to work out their differences at the bargaining table in a manner that helps businesses succeed while helping workers secure pay and benefits they can raise a family on and retire with dignity and respect."

UPS Strike Update

"Historic Deal" - Teamsters Union

Under the new agreement, existing UPS union workers will get $2.75 more per hour in 2023, and $7.50 more per hour over the length of the five-year contract. The agreement also includes a provision to increase starting pay for part-time workers, which the union had called the most at risk in the company’s workforce of being exploited. Starting pay for part-time workers will be $21 per hour, it said, up from $16.20 today. The average pay for part-timers had been $20, according to the company.


Teamsters General President Sean M. O’Brien said UPS put $30 billion in new money on the table as a result of the negotiations.


This contract sets a new standard in the labor movement and raises the bar for all workers,” said Teamsters General President Sean M O'Brien in a statement. He went on to advise that UPS has put an additional $30 billion of new money to be expended because of his negotiations.

UPS Freight

The negotiations also appear to have ended forced overtime on driver's days off and it settled on Martin Luther King Jr Day now being a holiday. Also per the earlier update, the drivers should have equipment now trucks equipped with air conditioning. UPS can end the forced overtime through converting part-time drivers into full-time which would result in an additional 7,500 jobs.


UPS CEO Carol Tome advised, “Together we reached a win-win-win agreement on the issues that are important to Teamsters leadership, our employees and to UPS and our customers. This agreement continues to reward UPS’s full- and part-time employees with industry-leading pay and benefits while retaining the flexibility we need to stay competitive, serve our customers and keep our business strong.


Since COVID, profits at UPS have grown 140% because Americans have been adopting to online shopping at a significantly higher rate. UPS ships a staggering 24 million packages daily, which is a quarter of all parcel volume (6% of the nations GDP).  According to Anderson Economics, a 10-day strike would have cost the US economy $7 billion and triggered "lasting harm" on small businesses and online retailers.  Alternative shipping companies would have had a hard time shouldering the excess capacity requirements which would also raised rates along with reducing on-time performance. This agreement is an enormous relief to shippers and TLI, and we will continue to monitor the situtation.

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