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FedEx and UPS spar over union rights

Dan Grech Jul 16, 2009

FedEx and UPS spar over union rights

Dan Grech Jul 16, 2009


Kai Ryssdal: Wall Street analysts usually look to FedEx and UPS as a sign of economic things to come. If they’re moving more packages that’s seen as a promising sign. Now, though, labor specialists are paying attention to a disagreement between this country’s two biggest delivery services. And this question: Is FedEx an airline or a trucker? Marketplace’s Dan Grech has more.

DAN GRECH: Congress is considering a change to labor law that would make it easier for FedEx Express drivers to unionize. FedEx currently is treated as an airline company, which is governed by the Railway Labor Act. Its industry rivals are treated as trucking companies governed by the National Labor Relations Act.

The new legislation would treat FedEx Express like a trucker. Ken Hall is a vice president at the Teamsters trucking union, which stands to gain new members from the change.

KEN HALL: We think it provides for a level playing field.

Rules on unionization are tougher in the airline industry, since local strikes can paralyze the national transportation system. Hall says that means FedEx drivers have historically had a harder time collective bargaining, as compared to UPS drivers.

HALL: UPS employees’ hourly wage rates are significantly higher, plus their health-insurance benefits are better and cost them less.

FedEx has said its wages and benefits are competitive with those of UPS.
And a FedEx spokesman said that 85 percent of FedEx Express shipments are delivered by air, while 85 percent of UPS packages are by truck. FedEx says the legislation would tip the scales in favor of its arch rival.

Earlier this month, FedEx started a Web site called Brown Bailout. The site includes a video parody that features a UPS employee searching Capitol Hill for the bailout office.

The dispute has created strange bedfellows. Siding with the Teamsters in backing the proposed legislation is a collection of conservative groups including the Frontiers of Freedom. George Landrith is the nonprofit group’s president. He says the legislation appeals to some conservatives because it will encourage fair competition in the transportation industry.

GEORGE LANDRITH: So now the question is will the law correct the accident of history and treat them the same. Or will it decide to treat one unfavorably and one favorably?

Landrith says he can think of few occasions over the past two decades that he’s agreed with the Teamsters on anything.

I’m Dan Grech for Marketplace.

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