FedEx pilots reach new six-year agreement with Air Line Pilots Association

Earlier today, the FedEx union pilots represented by the Air Line Pilots Association (ALPA) signed a new contract with FedEx management, according to ALPA officials.

ALPA said that the new contract takes effect in November and becomes amendable in 2021. And it added that the new contract is comprised of across-the-board increases for hourly pay rates and new-hire compensation, a significant signing bonus, retirement plan enhancements, and work-rule improvements, among other positive modifications.

“With the ballot to approve or reject the agreement open for nearly a month, our pilots did their due diligence to analyze and evaluate this agreement,” said FedEx MEC (Master Executive Council, the governing body of the FedEx unit of ALPA) Chairman Captain Chuck Dyer in a statement. “In the end, the majority felt we achieved an agreement that brings improvements and recognizes our contribution to the success of FedEx.”

The Memphis Commercial Appeal reported that 57 percent voted in favor of the contract agreement and 43 voted against it, adding that the agreement calls for pay increases of 10 percent initially and slightly more than 3 percent per year through 2021, as well as one-time bonuses that were estimated at $20,000-$35,000 per pilot.

On August 19, the FedEx MEC approved the tentative contract reached with FedEx management, with the FedEx contract ratification vote presented to more than 4,000 FedEx pilots, with voting kicked off on September 28 and closed on October 20. Formal negotiations between FedEx and ALPA began in January 2013.

As for FedEx’ main competitor, UPS, LM reported in September that the Independent Pilots Association (IPA), a trade union representing pilots at UPS said its leadership called on its 2,528 members to authorize a pilot strike against UPS. It said that if this gets membership approval, the IPA’s five-member executive board would be able to request a release from federally-mediated negotiations with UPS. Results of this vote will be announced on October 23.

“A strike is the least desirable outcome of labor negotiations, but after four years of contract talks with UPS we’ve reached a point where UPS needs to hear loud and clear from our membership that they are willing to do whatever it takes to secure an industry leading contract,” said IPA President, Captain Robert Travis in a statement. “UPS has stalled and delayed, unnecessarily prolonging our negotiations. UPS management has created a bitter standoff with its pilot employees.”

Jerry Hempstead, president of parcel consultancy Hempstead Consulting, said in a recent interview that one needs to know that the UPS pilots cannot simply walk out and strike, calling it saber rattling.

“The pilots are currently under mandated negotiations,” he said. “The vote is that the leadership of the Union can ask the appointed negotiator if they can get out of the mandate. There are several dynamics here. One is that the Fedex pilots have come to an agreement with management. So shippers can get through the holiday shipping period with the peace of mind that the FedEx pilots will be on the job. Conversely the UPS pilots now have sewn FUD (Fear, Uncertainty, & Doubt) into the minds of UPS customers.

The greater risk, Hempstead said, would be if UPS Pilots “work to the rule” and call in sick, among other actions, to slow down UPS during the peak shipping season, adding that IPA is doing what is expected to put pressure on management to make more concessions, which, in turn, mean higher shipping rates for shippers).

“Management at UPS is very disciplined and I’m sure the issues separating the parties will get resolved without a service interruption,” he said. “The efficacy of UPS and FedEx are now so critical to the U.S. economy I just can’t envision the government allowing the pilots to strike.”