UPS wields carrots and sticks!
UPS, the world’s largest package shipper, has wielded both carrot and stick in its labor relations to build on 17 straight quarters of profit growth.
The Atlanta company says an automation drive rolled out last year enables management to track each package from pickup to delivery, squeezing out unnecessary steps.
Dock workers now load three to four brown vans per shift, up from two previously, company spokesman Norman Black said.
Drivers trimmed 2.95 million miles from their routes in November alone — partly by avoiding left-hand turns — while handling more packages.
At the same time, the company in December offered buyouts to 650 managers older
than 50, a month after eliminating 1,200 jobs in its logistics division to reduce labor costs.
“What we’re doing is targeting our most senior managers who are closest to retirement, who are also the highest-paid,” Black said.
Profit gains enabled UPS to fund a 74 percent increase in dividends and a 6 percent reduction in outstanding shares over the past three years. That includes USD4.4 billion spent in 2005 and 2006 to repurchase about 60 million shares.
The efficiency drive has cost the company in other ways. UPS will pay more than USD87 million to settle a class-action lawsuit in California accusing it of improperly deducting meal breaks from the paychecks of 19,762 drivers, who frequently didn’t take them.
