UPS (CCJ Top 250, No. 2) on Friday readied itself for a strike that could be just more than two weeks away, deploying business continuity training to its employees across the U.S.
UPS is locked in a battle with the International Brotherhood of Teamsters (IBT) over the renewal of a labor agreement that expires July 31. Teamsters represent more than 340,000 full- and part-time UPS workers and the union has made clear that its UPS members will not work beyond the expiration of the current contract. Union members have already authorized a strike.
[Related: TForce Freight reaches agreement with Teamsters, likely avoiding a strike next month]
UPS said Friday its remains focused on reaching an agreement with the IBT "that is a win for UPS employees, our customers, our union and our company before Aug. 1. While we have made great progress and are close to reaching an agreement, we have a responsibility as an essential service provider to take steps to help ensure we can deliver our customers’ packages if the Teamsters choose to strike."
Over the coming weeks, UPS said many of its U.S. employees will participate in training that would help them safely serve customers if there is a labor disruption. "This temporary plan has no effect on current operations and the industry-leading service our people continue to provide for our customers," the package carrier said. "This training is aligned with our ongoing commitment to safety and business continuity. These activities also will not take away from our ongoing efforts to finalize a new contract that increases our employees’ already industry-leading wages and benefits, allows UPS to remain competitive and provides certainty for our customers and the U.S. economy."
A strike could dump upwards of 20 million parcels into the market. Michigan State Eli Broad College of Business supply chain professor and veteran transportation economist Jason Miller estimated the market could absorb roughly 20% of stranded UPS volume.
In the near term, shippers face high costs and limited options to shift volumes away from UPS in the event of a strike, as deadlines set by FedEx and regional carriers for shippers to secure capacity have passed. FedEx last week said its priority is protecting capacity and service for its existing customers, and encouraged shippers considering shifting volume to FedEx, or in discussions with the company to open a new account, to begin shipping with FedEx now.
