UPS, Teamsters Agree to Five-Year Contract
UPS Inc. said Sunday it had reached a tentative agreement with the Teamsters union on a new, five-year contract covering the company’s 240,000 full- and part-time U.S. employees.
The tentative contract, which now must be presented to UPS’ Teamster-represented employees for ratification, was negotiated nearly a year in advance of the current expiration, which was set for July 31, 2008.
Upon ratification, most provisions of the new agreement will take effect on August 1, 2008, UPS said in a statement.
The new contract calls for UPS to fully fund a new pension plan jointly administered by the union and the company, Ken Hall, director of the Teamsters’ parcel and small-package division, told Bloomberg News. Further contract details were not disclosed, Bloomberg reported.
Bear Stearns & Co. transportation analyst Ed Wolfe wrote in a note to investors Monday that "we don’t expect to hear much from UPS until the contract is ratified in about 60 days, but from various sources we believe the terms are typical" of about 3% to 3.5% annual wage increases and 5% to 6% annual pension increases.
“This agreement is good for our people, good for our customers and good for our company,” said UPS Chairman and Chief Executive Officer Mike Eskew. “This agreement will allow us to remain competitive in a challenging marketplace.”
“The fact that we have reached an agreement earlier than at any time in our history is a testament to the skills and determination of all those involved in these talks,” he said in a statement.
UPS is ranked No. 1 on the Transport Topics 100 listing of U.S. and Canadian for-hire carriers.
