August 17, 1997

Strike Against UPS Focuses On Two-Tier Jobs Problem

The long-predicted age of Aquarius has arrived in the form of a strike by the Teamsters Union against United Parcel Service. How it is settled could set a work pattern for the next century. At issue are two disputes. Teamsters want the company to transfer 10,000 part-time employees to full-time jobs with a substantial hike in pay. UPS wants the union to let the employee pension plan be managed by the company.

Of the 185,000 UPS employees, 107,000 are part-timers who start at $8 an hour and top out at $11. The 78,000 full-timers -- mostly drivers and supervisors -- earn $19.95 an hour. Rates of company payments into pensions and other benefits are the same for all employees. Totals are based on wages and time accumulated. Obviously, part-time benefit costs to the company are about half that for full-timers.

The union contends UPS pursues a policy of hiring part-timers in order to increase profits. UPS cleared $1.2 billion last year, all of which went to company employees and managers. Company stock is not publicly owned. Many part-time workers do not want full-time -- the company says 70 percent. According to the U.S. Department of Labor, 76 percent of part-timers nationwide are voluntary and do not want full-time. These include ambitious workers with full-time jobs elsewhere, mothers with children, students, and retirees supplementing their Social Security.

UPS says part-timers are necessary for two reasons -- to compete with non-union shippers such as Federal Express, and to cope efficiently with the morning and evening surges in sorting, loading and unloading.

The company asserts it moved 13,000 part-timers to full time last year -- without union prodding -- and gives employees first consideration. However, some part-timers claim they have waited years for promotion or pay raises.

The pension dispute is not so complicated. Yearly pension premiums of $1 billion are paid into the Teamsters "multi-employer" plan by UPS. This is one-sixth of the total amount contributed by the plan's 35 companies.

UPS chief executive officer James P. Kelly, says the company could increase pension payments to its employees by an average 50 percent if it did not have to subsidize less profitable truckers.

Teamsters President Ron Carey, a former UPS deliveryman, calls the pension offer a subterfuge for the company "to get its hands on the investment fund and funnel that back into their pockets."

Kelly points out that Federal regulations prevent companies from taking pension fund surplus for their own use. He acknowledges the company could reduce its contributions if there are more assets than needed to back up benefits.

He insists the company's contract proposal should have been submitted to employees for vote before a strike was authorized. Private polling indicates union members would approve the company offer. As this is written, the company says it has made its "last, best offer." It declares "15,000 jobs will be lost to competitors if the strike goes on much longer. This sounds like a warning that UPS soon will start replacing strikers.

Carey has struck a cord with his crusade on behalf of part-time workers. The massive "down-sizing" and "out- sourcing" launched by major corporations in recent years appears to have disrupted traditional labor patterns.

Opportunities for unskilled under-educated workers to earn a middle class wage are dwindling. A global economy, utilizing third-world labor, is hard upon us. U.S. manufacturing is increasing, but largely of high-technology products -- by computers and automated machines which never take coffee breaks, get sick, go on strike, or retire with pensions.

A two-tier work force is inevitable. High-wage earners will be those able to create new devices, follow complicated instructions, devise efficient procedures, build and operate technical equipment.

United Parcel Service is an example of the new age. It organized a slow low-paying service into an essential component of world commerce. High technology and insightful procedures made this possible -- airplanes, a network of sorting centers, efficient use of labor, hand-held computers enabling delivery personnel to track 12 million packages a day anywhere in the world.

Strong backs are no longer enough -- no matter how well organized. The world is overwhelmed with strong backs. These will be less well paid. It is no coincidence that labor union membership for private sector workers has fallen from 24 percent two decades ago to 10 percent today. Manual labor is no longer a critical factor. The Teamsters strike may be labor's last hurrah.

Premium pay will go to operators of sophisticated equipment, to public contact personnel with good attitudes, to office workers with computer ability, to managers with college degrees. These already are in short supply.

The law of supply and demand is heartless, but it controls all economies -- communism, socialism and liberalism notwithstanding.

Educate or suffer.

PARTING SHOTS

• Washington wags speculate that as a result of the package-shipping strike inconveniencing millions of customers, UPS and Federal Express will merge into a new company called Fed/Up.
  
• Hillsdale College ( Mich.) notes in its newsletter that times have changed. In 1940, teachers listed their main problems as pupils talking out of turn, chewing gum, running in halls, cutting in lines, dress code infractions and littering. Teachers recently named drugs, smoking, alcohol, guns, pregnancy, suicide, rape, robbery and assault.

By Lindsey Williams, columnist for Sun Coast Media Group newspapers