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Why UPS workers may go on strike

The Teamsters union, which represents about 340,000 UPS workers, is calling for better benefits, pay raises and to ax the two-tier wage system for part-time and full-time workers.

Delivering packages can often be a physically demanding job and especially with temperatures this summer hitting record highs, the conditions can range from uncomfortable to unsafe. UPS has reported at least 143 heat-related injuries to the federal Occupational Safety and Health Administration since 2015. In some cases, workers have been hospitalized, or even died.

A tentative agreement over air conditioning in delivery vehicles was reached in June, but negotiations fell apart last week, with each side accusing the other of walking away from the table.

On the UPS website, it says full-timers make $95,000 a year and part-timers earn $20 an hour on average after 30 days — but union leader Sean O’Brien told ABC News that’s “not telling the true story.”

O’Brien says full-timers work 60 to 65 hours a week, while part-time wages are actually closer to $16 an hour.

“UPS is selective. They pick and choose on who they're going to pay, what area, and they can raise the rates,” he says.

O’Brien says part-time workers are currently “working for poverty wages,” and his goal is to ensure UPS establishes a livable starting wage for these workers. The company reported over $100 billion in revenue last year, and O’Brien believes union members deserve to reap some of those benefits as well.

And many full-time workers agree. “I’ll sacrifice two weeks of work if [I have to] because that’s what solidarity is. That’s what we do,” Trujillo says in his video.

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What a strike means for the economy

A 10-day UPS strike could cost the U.S. economy over $7 billion, with $4 billion in losses for consumers and small businesses, according to analysis from consulting firm Anderson Economic Group. This would also mark the most expensive strike in at least a century.

UPS makes up 24% of the market share by parcel volume, according to Pitney Bowes Parcel Shipping Index. Competitor FedEx also revealed in an internal report obtained by NPR that, "In the event of a market disruption, no carrier can absorb all UPS volume.”

If a strike goes ahead, Americans can expect slower delivery times, supply chain disruptions and even higher shipping costs.

Ohio State University logistics professor Terry Esper also told Forbes that rural areas with limited delivery options and small businesses that can’t afford to switch providers will be hardest hit by the strike.

Esper says even if businesses do find another provider, since many are contracted to delivery companies, any last-minute switching to standard published rates could drastically push up costs — and likely result in those costs being passed on to consumers.

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About the Author

Serah Louis

Serah Louis

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Serah Louis is a reporter with Moneywise.com. She enjoys tackling topical personal finance issues for young people and women and covering the latest in financial news.

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