UPS, Teamsters Reach Tentative Deal to Avert Nation’s Largest-Ever Single Employer Strike

A strike by UPS workers would have had potentially catastrophic economic implications: the shipping company is responsible for moving 9% of the US economy each year, and the US Chamber of Commerce estimated the strike would cost $3.8 billion per day.

Just days before a contract was set to expire, the United Parcel Service (UPS) and International Brotherhood of Teamsters (IBT) announced they had reached a tentative agreement on a new contract.

In a Tuesday statement, the labor union said a $30 billion contract had been reached for a duration of five years. The deal will still have to be accepted before a strike is firmly averted.

“We demanded the best contract in the history of UPS, and we got it,” said Teamsters General President Sean M. O’Brien. “This contract sets a new standard in the labor movement and raises the bar for all workers.”

According to the statement, the UPS workers won a substantial wage increase, including for part-time delivery drivers whose exclusion from a raise under a two-tier system created by the company had been the subject of contention that collapsed talks earlier this month.

UPS has reportedly agreed to pay new part-time workers $21 an hour, up from the $16.20 they start at presently. Existing workers will also get a raise of $7.50 per hour over the next five years, $2.75 of which will happen before the year is out.

In addition, 7,500 part-time driving positions will now become full-time positions.

It also establishes Martin Luther King, Jr. Day in January as a paid holiday for all workers, and bans driver-facing cameras in truck cabs as well as forced overtime work on drivers’ scheduled days off.

UPS CEO Carol Tomé also praised the deal, calling it a “win-win-win.”

“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,” Tomé said.

The Teamsters authorized a strike in a near-unanimous vote last month, which would have started on August 1 without Tuesday’s deal.

Such a strike would have been the largest strike by employees of a single employer in US history, with an estimated 340,000 UPS workers set to walk off the job. The pilots of UPS delivery aircraft, who are represented by a separate union, said they would also refuse to fly if the Teamsters struck. The last time the Teamsters struck for a UPS contract in 1997, the pilots similarly honored their picket line.

The contract deal comes as much of Hollywood remains on the picket line. Actors represented by SAG-AFTRA joined writers represented by WGA in protesting many of the same trends, including the influence of AI on film and television production and the impact of streaming apps on the industry.