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UPS, Teamsters reach contract agreement to avoid strike

A tentative deal has been reached that would have averted a strike by UPS workers.
A tentative deal has been reached that would have averted a strike by UPS workers.

The nation’s retailers are breathing a sigh of relief after a tentative agreement was reached to avoid a strike that would have brought more disruption to the nation’s supply chain.

The United Parcel Service and the Teamsters union representing more than 325,000 UPS workers on Tuesday reached a preliminary labor agreement, a key move in avoiding a potential strike that could have started next week.  The deal includes raises for both full- and part-time workers, the elimination of a lower-paid class of delivery driver and the installation of air-conditioning units in new delivery vans for the first time. The agreement still needs to be ratified by rank-and-file members.

“UPS has put $30 billion in new money on the table as a direct result of these negotiations,” Teamsters president Sean O’Brien said in a statement Tuesday. “This contract sets a new standard in the labor movement and raises the bar for all workers.”

Gaston Curk, CEO and co-founder of OSM Worldwide, said that major carrier strikes, like what could have happened with UPS,  and other significant disruptions can have far-reaching effects for business-to-consumer and business-to-business shipping. He noted that the uncertainty the potential UPS strike created is just one example of a potential disruption, albeit a very large one, that highlights the imperative of brands to implement a multi-carrier strategy.

"We’re seeing on a larger scale than ever that brands are hesitant to put all of their eggs in one basket," Curk said.

The Retail Industry Leaders Association and the National Retail Federation both welcomed the tentative UPS and Teamsters agreement.

“News of a tentative UPS-Teamsters contract agreement is an enormous relief to retailers, who have been navigating the possibility of a strike and the associated uncertainty for weeks,” stated RILA. “We’ve learned all too well over the last several years the impact supply chain disruptions can have. We’re grateful that this challenge, which would have had a price tag in the billions of dollars and a long runway for recovery, was avoided.”

RILA added that it encourages “a quick ratification and adoption of the agreement to ensure this chapter of uncertainty is closed.” 

In its statement, NRF said it was grateful that UPS, “a major partner of the retail industry, “had  come to an agreement with the Teamsters “without disruption to the marketplace.”

“Retailers rely on stability within their supply chains, and this agreement will bring long-term stability, as well as assurance to the millions of businesses and employees who rely on smooth and efficient last-mile delivery,” NRF stated.


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