United Parcel Teamsters ratify new five-year contract
United Parcel Service Inc. workers represented by the Teamsters approved a five-year contract with annual wage and benefit increases of about 4.1 percent, the union said.
The agreement, reached Sept. 30, was ratified by 65 percent of Teamsters voting, union spokesman Bret Caldwell said today in an interview. Atlanta-based UPS, the world’s biggest package- shipping company, is the largest employer of Teamsters.
UPS and the Teamsters agreed on terms 10 months before the existing contract expires, early enough to assuage customers who might have shifted to rival shippers if there was danger of a strike. The agreement covers about 240,000 UPS drivers, clerks and package sorters.
UPS hasn’t disclosed its costs for the contract, which takes effect Aug. 1. In addition to the wage and benefit increase, Atlanta-based UPS agreed to pay USD 6.1 billion before taxes to withdraw from the Central States Fund, a multiemployer pension plan for 42,000 Teamster members.
Supplements Rejected
Five contract supplements that affect local Teamster units were rejected, and negotiations on those will resume, the union said. The supplement votes don’t affect the national agreement.
Starting pay will climb to USD 16.10 an hour from USD 14.70. The rate for workers with 24 months’ seniority will increase to USD 20.75 from USD 18.90. The union hasn’t provided information on changes to top pay. The current highest rate for a UPS driver is about USD 28 an hour.
The new contract raises hourly pay for most full-time workers 70 cents next year, 75 cents in 2009 and 2010, 85 cents in 2011 and 95 cents in 2012. The annual increases will be paid in two equal installments, with half received each Aug. 1 and the rest Feb. 1 of the next calendar year.
The combined increase of USD 9 an hour over the term of the agreement compares with a boost of USD 8.75 an hour in a six-year contract reached in 2002.
UPS will pay about USD 3.9 billion after taxes to exit the Central States fund, analysts have estimated. The company wanted to leave the underfunded plan to gain stability in pension costs. It agreed to fully fund a new plan run by the company and the union.
