As contract negotiations between the Teamsters union and UPS, one of the world's largest shipping companies, continue, the potential for a significant strike looms on the horizon. Representing over 340,000 UPS workers, the Teamsters union is seeking substantial improvements in wages, working conditions, and even the installation of air conditioning in delivery vans. While UPS has offered some concessions, an agreement has not yet been reached. If no resolution is achieved by July 31, the union has authorized a strike commencing on August 1. The impact of such a strike would be unprecedented, making it the largest against a single business in U.S. history. This article delves into the key issues at stake, the potential consequences, and offers advice to e-commerce businesses on how to navigate the situation effectively.
Please note that the information provided is accurate as of June 20, 2023, and negotiations are ongoing.
Malomo is a leader in order tracking solutions for Shopify businesses. This article is valuable to all brands in e-Commerce, but we also provide tips at the very end that are specific to Shopify merchants who can employ Malomo quickly not only to brand the order tracking experience, but also to reduce WISMO and support tickets related to shipping updates which will be critical if there is a strike.
What is the UPS Strike About?
- The Teamsters union, which represents over 340,000 UPS workers, is in contract negotiations with the company.
- The union is seeking significant wage increases, better working conditions, and air conditioning for delivery vans.
- UPS has offered some concessions, but the union has not yet accepted them.
- If no agreement is reached by July 31, the union has authorized a strike, which could begin on August 1.
- This strike would be the largest against a single business in US history.
- It would have a significant impact on the economy, as UPS is one of the largest shipping companies in the world.
Here are some of the key issues that the union is seeking to address in the new contract:
- Wages: The union is seeking significant wage increases, in line with the rising cost of living.
- Working conditions: The union is seeking better working conditions, including shorter workweeks, more predictable schedules, and increased safety measures.
- Air conditioning: The union is seeking air conditioning for all delivery vans, as the lack of air conditioning can be a health and safety hazard for workers. on June 13th, 2023 UPS announced they made an agreement with Teamsters on Heat Safety.
The union has said that it is willing to strike if necessary to get a fair contract. UPS has said that it is committed to reaching an agreement with the union.
The outcome of the UPS strike will have a significant impact on the economy. If a strike does occur, it could disrupt shipping and delivery services, leading to higher prices and shortages of goods. It could also lead to job losses, as businesses may be forced to cut costs in order to offset the lost revenue.
Summary Timeline of the UPS Strike:
- August 1, 2022: The Teamsters union launches a "Call to Action" campaign and releases a UPS Teamsters app. This is the 25th anniversary of the 1997 UPS strike.
- September 2022: The union distributes UPS contract surveys to members.
- October 2022: The union holds regional meetings and compiles and releases the results of the contract surveys.
- November 2022: The union meets with local unions, subcommittees, and regional representatives to discuss proposals.
- December 2022: The union reviews the language of the contract proposal.
- January-March 2023: The union negotiates supplemental contracts.
- April-July 2023: The union negotiates the master agreement contract.
- July 31, 2023: The current contract expires. If no agreement is reached, a strike could begin on August 1.
- Source: Teamsters.org
How e-Commerce Businesses Can Prepare for the UPS Strike:
Start planning early. The earlier you start planning, the more time you will have to identify alternative shipping providers, renegotiate contracts, and implement contingency plans.
The most important prep you can do is:
- Identify alternative shipping providers but don't shift volume too soon. If UPS is not available, you will need to identify alternative shipping providers. But if they don't strike, you could cause ops mayhem on your own accord. USPS and FedEx have already stated that they cannot handle all of volume if UPS strikes. If too much volume transitions to them, they might experience negative impacts too. So, consider other networks of carriers like regional or specialized carriers.
- Renegotiate contracts. If you have a contract with UPS, you may be able to renegotiate the terms of the contract. This could include extending the contract, changing the shipping rates, or adding additional services.
- Implement contingency plans. Have a contingency plan in place in case a strike does occur. This plan should include things like which alternative shipping providers will get preference, adjusting your shipping policies, and knowing how you'll communicate with customers.
- Stockpile inventory. If you think a strike is likely, you may want to stockpile inventory so that you have enough product to sell even if there are shipping delays.
- Be prepared for customer inquiries. Customers may have questions about the strike and how it will impact their orders. Be prepared to answer these questions and provide them with accurate information.
- Monitor the situation closely. Stay up-to-date on the latest news and developments regarding the strike. This will help you make informed decisions about how to best protect your business. You can find the latest from the bargaining table here.
What Should e-Commerce Businesses Do if UPS Strikes?
- Communicate with customers. Be transparent with customers about the potential impact of a strike on their orders. If you're primarily using UPS, then you'll want to be further ahead of this than others. Keep them updated on the situation, make sure they know you're following it and let them know what you are doing to mitigate the impact. This will help to manage expectations and avoid customer frustration.
- Offer alternative shipping options. If UPS is not available, offer customers alternative shipping options, such as USPS, FedEx, or DHL. Work with your 3PLs to assess your options.
- Be flexible. Be prepared to adjust your shipping policies and procedures if necessary. For example, you may need to increase shipping costs or offer longer delivery estimates.
- Provide excellent customer service. Even if a strike does occur, you can still provide excellent customer service. Be responsive to customer inquiries and do your best to meet their expectations. Prepare for how you'll handle messaging and updates.
- Be proactive. Don't wait for the strike to start before taking action. Start planning now and be prepared to implement your contingency plans as soon as necessary.
How Shopify brands can mitigate the risks of a UPS Strike:
Shopify brands are in a unique situation. Some brands are very large and have had contingency plans in place for months, but many are startups or scale-ups that don't have time a resources to prepare for an event like this. Luckily, the Shopify ecosystem allows its merchants to plug into tools that can elevate their experience so they can punch above their weight class. Here is what we're recommending specifically for Shopify merchants in addition to the tips above:
- Implement an order tracking tool ASAP, even if you aren't branding or redirecting traffic to your order tracking page (which can take just minutes in your Shopify theme). This creates a connection between your carrier data and your order tracking tool which will be critical if there is a UPS strike.
- Evaluate how you can segment down to a list of customers who have packages located at a specific carrier or in transit with a specific carrier. This is important because if there is a UPS strike you'll need to be able to ID the customers who will need updates from you if their packages are stuck with UPS during the strike. There might also be other carriers who begin experiencing delays because they get overwhelmed with inventory that would have otherwise been handled by UPS, and you'll need to be able to segment customers impacted by the other carrier(s) now too. Malomo customers will tap into their shipping and carrier tracking data in the Malomo dashboard for this.
- Have a way to identify stalled, lost or late shipments. If UPS strikes, these shipment metrics will go way up. Malomo customers can tap into their Problem Orders data but may need to alter the criteria for problem orders during this time because everything could be delayed longer than normal. You'll want a way to adjust the detection rules so you aren't being notified about packages that aren't truly problems during the crisis.
- Begin planning updates to your transactional messaging for the new segments and flows that you might need during this time. By thinking through the types of updates you'll want to send to customers, you'll gain more clarity on the types of data and information you'll need. It's never too early to start drafting possible messaging so you can move more quickly.