U.S. employers should expect a tougher battle in labor negotiations, the head of one of the country’s largest labor unions warned, as he prepares for a contract dispute that could lead to the most disruptive strike in decades.
“We are taking a militant approach,” Teamsters chairman Sean O’Brien told the Financial Times during an interview, saying members were now less willing to compromise with employers and more willing to strike. “(We say) this is what we want, this is what our members need, this is what they deserve. And then they’re going to give it to us. And we fight if we have to.”
O’Brien’s comments come as the Teamsters renegotiate the country’s largest union contract in the private sector, between delivery service UPS and its 340,000 US-based drivers and package handlers. Among other things, the union is demanding universal wage increases, the end of the existing two-tier pay system and the installation of air conditioning in trucks.
He has repeatedly promised that the Teamsters will go on strike if they fail to reach an agreement with UPS after their contract expires on July 31. healthcare benefits. Union members will vote this week on whether to authorize O’Brien to call a strike.
Business leaders have urged the two sides to reach a compromise, warning that a strike would affect consumers and businesses across the U.S. economy. UPS delivered one in four of the 58 million packages shipped daily in the US last year, more than FedEx or Amazon and second only to the US Postal Service, according to the Pitney Bowes Shipping Index.
Competitors have echoed those concerns, with Mike Parra, CEO of DHL’s Americas division, saying other parcel delivery services wouldn’t be able to pick up the slack.
The Teamsters’ last strike in 1997 “cost UPS a lot of money, but it destroyed us all,” said Parra: “Everyone’s network got overwhelmed . . . so I hope it doesn’t happen.”
UPS has expressed optimism about reaching a deal and preparing contingency plans for any outages. It admits that some clients have already “redirected” their work elsewhere.
“Although we expect a lot of noise during the negotiations, I remain convinced that a win-win-win contract is very feasible,” UPS CEO Carol Tomé told analysts in April.
Deutsche Bank analysts said last month they thought a strike was unlikely, citing the “significant” advantages UPS’s Teamsters already enjoyed, the “narrow” gap between the two sides’ positions and the limited resources of the union for compensating striking workers.
Still, the analysts noted that “the rhetoric has warmed up” about the dispute. O’Brien has indicated from the outset that he is unwilling to compromise, cutting the time for talks from the standard one year to just 12 weeks.
“The longer these contract negotiations go on, the longer Wall Street will be affected,” O’Brien said. “And that’s okay, as long as Main Street gets cleaned up at the end of the day.”
Large-scale workers’ strikes were once common in the US, before Ronald Reagan fired more than 11,000 striking air traffic controllers in 1981. The event encouraged employers to fire their own striking workers, weakening the unions’ greatest weapon.
The number of major U.S. strikes, involving 1,000 workers or more, dropped from 187 to 16 between 1980 and 2021, while union membership has roughly halved to a record low of 10.1 percent in 2022, according to labor department data.
Interest in unions increased early during the coronavirus pandemic with high-profile campaigns at Starbucks, Amazon and Apple. But those new unions have struggled to secure the labor contracts needed to create profits for workers, and the formation of bargaining units has slowed.
O’Brien said winning higher wages and improving working conditions was the best way to retain existing union members and attract new ones. The Teamsters have also launched a campaign to organize workers at Amazon and are actively renegotiating contracts with shipper Yellow Corp and the American Red Cross.
The Teamsters elected O’Brien president in November 2021, following a tumultuous few years for the union. UPS employees, who make up the largest group of members of any given company, were angry with previous leaders for using a loophole in the union’s constitution to push through a 2019 labor contract that 54 percent of members voted down.
Workers also said an influx of packages since the start of the Covid crisis had made their jobs untenable.
A fourth-generation Teamster and long-time Boston local leader, O’Brien was an outspoken critic of then-President James Hoffa, the son of Jimmy Hoffa, the late legendary Teamsters boss. He campaigned against a candidate endorsed by Hoffa with a promise to be more “assertive” with employers.
According to David Witwer, a professor at Pennsylvania State University who studies the Teamsters, O’Brien’s election marked only the second time in the union’s 120-year history that an incumbent or someone endorsed by someone was not nationally elected. Teamsters pageant won.
“(James Hoffa) took the path of least resistance,” O’Brien said. “The only thing our administration is focused on is not giving in.”
There are indications that other major unions are following O’Brien’s lead.
The number of strikes involving at least 1,000 workers rose nearly 50 percent to 23 in 2022, according to labor department data. It was the highest number of major strikes in two decades.
United Auto Workers, the 391,000-member union representing workers at General Motors, Stellantis and Ford, elected a new president in March who also pledged to be tougher on employers. At a union-wide town hall meeting with members on Friday, Shawn Fain said he “will not accept any concessions” in their contract negotiations later this year.
“They can afford our demands, and we expect them to posit,” Fain said.
When asked if he expected a strike at UPS, O’Brien said he didn’t know, but remained convinced that UPS would eventually agree to the Teamsters’ demands.
“I don’t think they have a choice,” he said.
Additional reporting by Andrew Edgecliffe-Johnson