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Global Category Intelligence
Q2 2025
Global Category Intelligence
Q2 2025
Jabil Logistics Update
UPS and Teamsters Stall Discussions
Negotiations between UPS and the Teamsters have stalled, less than a month before the contract deadline on July 31, 2023. Discussions broke down on July 5, 2023, with both sides alleging that the other walked away from the negotiating table. Without an agreement in place around higher pay, more full-time jobs, and better workplace health and safety conditions, the union said that its 340,000 full- and part-time workers will strike.
Despite progress in the talks, including removing the two-tier programs for drivers, a tentative agreement to make Martin Luther King Jr. Day a holiday, and installing more air-conditioning units in trucks, the union says the company has not met their demands. The union has subsequently facilitated ‘practice strikes’ across the nation to prepare for industrial action.
It remains unclear when or if UPS and Teamsters will return to the negotiating table, with the largest disagreement centering on pay rises for workers. However, as Bloomberg estimates that UPS could lose in the region of $170 million per day if the strikes proceed, the prospect of further negotiations driven by the company remains highly likely.
If the current contract expires at the end of July without an agreement, the union could start its strike as early as August 1, 2023. If the proposed industrial action proceeds, significant delays, and increased logistics costs are anticipated, as UPS handles approximately 25% of packages in the United States, handling 5.2 bllion packages in 2022.
USPS and FedEx released statements encouraging UPS customers to utilize their services quickly, anticipating disruption following a strike. Although USPS and FedEx could mitigate some of the fallout, there is insufficient capacity to handle the 24.3 million packages UPS delivers daily.
We will continue to update you on the negotiations and the mitigations we are adopting to ensure continuity of service.
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