Comparison: Last, Best & Final to Pre-strike proposals

[104Feeder]

Ever thought about going into politics?

Sure, but the way campaigns are run nowadays you would have to be a Saint, have a team of lawyers on call to bury any skeletons, or an extreme narcissist to enjoy having your personal life raked over the coals for all to see.

My politics might surprise you...

 

[104Feeder]

I like the thinking behind the refinery idea. That is getting creative. I do not believe it would work for us though. Fuel is a much larger percentage of total cost for Delta than for us, it is their largest expe nse by far. So the money invested would get paid back by the savings in a relatively short time. I do not know what the break even point for UPS to buy a refinery would be, but I would estimate a long, long time, maybe a hundred years? I really don't know.
Certainly worth some exploration. I was surprised and impressed that Delta did that and I would love to see how it works out. Our fuel costs for just diesel in my building (I think we have about 70 or so tractors and probably quadruple that in package cars) is about $30,000/day (7300 gallon drop daily @$4=$29,200). I'm not sure how Phoenix compares to the rest of the Country but if that is the average per state you are looking at $1.5 million/day, something like $5 billion/yr?(calculator went in to scientific mode) Delta spent $12 billion last year and expects to save $300 million. I know we hedge fuel but it's my understanding that hedging has been difficult to say the least over the last 5 years or so. Seeing as we've been in business over 100 years it's something we probably should have done 40 years ago.

I get that you would rather screw over, as you put it, those in management than the Teamsters employees of UPS. Given that you are in the Teamsters, plus adding in the fact that you clearly despise those of us in management, I find that completely understandable. You will be happy to know that since the 1997 failure to share the burden of controlling rising costs with the Teamsters, UPS has been doing just that, and screwing over Management. Benefits have been cut, and part of their cost shifted to management employees, the ranks have been and continue to be thinned. From a cost containment stand point, all well and good.
On the contrary, I would like to see less management overall & no one should be getting screwed over on either side. You know that often told analogy about 5 city workers watching the one with the shovel? That's the impression I get walking through any hub except it's 5 management people watching 10 workers. More management is not better management, and it seems to me with less of the part-time management in particular there would be more money to spread around to the rest of you. Of course I'm going to say we should just jettison the whole Telematic et. al. crew ASAP. So just as I despise that Driver that always seems to get out of the s--t jobs I despise the management standing around texting or running around just harassing people in the hub instead of fixing the problem.

The problem with UPS management is the reliance on fear and intimidation instead of leadership & mutual respect. For example, one of my managers talks to everyone with respect & never makes you feel he is pulling the superiority card. Sure, he'll direct you if it gets to that point but in 3 years working with him I've never seen him have to do it. He'll listen & reason with you and never make you feel that he didn't respect your position even if he still doesn't see it your way (and being UPS, they usually don't of course). As a result he rarely gets push-back when he needs something done. Now the on-roads, both in Feeder and Package, aren't there to try to get you to work for them, but instead treat everyone as if they are the Problem and need harassment to get in line. Sure, some Drivers need that harassment to get their attention but not all of them. When even the runner/gunners, the "I stay off the radar" Drivers are complaining about harassment it's obviously well out of hand.

Being in IE you probably fall into the category of what I would consider mostly useless management, but I would hope you would be the exception. That's not a personal slam and I'm sure you are used to worse. IE rarely has been a help in my area, and how UPS decides who goes in there is a mystery to me (how exactly does an on-road with just a high school diploma qualify for IE?). I once had an IE guy ride with me on my route (pre-EDD) and was going to "fix" it by changing the way I looped the route. After 8 years on the route I had it timed like clockwork to miss all the school buses as I had 5 schools in the loop. His fixing had me waiting more than 25 minutes for school buses and school crossings. My manager overrode the IE person and had me go back to doing it my way.

There are many other areas where UPS can and has controlled the growth of costs. The real problem is that these are the smaller costs. It would be like a family getting an older car to reduce car payments, raising their thermostat and watching water use to lower their utility bills, and then wondering why their monthly expenses keep going up, as they ignore the ballooning payments on their adjustable mortgage. You cannot effectively control costs if you persist in ignoring the largest expense you have.
Labor is always going to be the largest expense. I see no reason for us to hold the line on wages especially since management has proven that they don't blink at paying a Driver $90+/hr to deliver packages. That tells me our true fair wage is somewhere over $90/hr.

I suppose we could just stop raising rates in response to rising costs. We would soon then be loosing money instead of making it. We would wind up having to borrow to keep our operation running. We would of course win back more business, no doubt, with lower rates. So maybe we could get more investors. Maybe change our tag line from the gawd awful we heart logistics to "We are moving more packages than ever before, and losing money on each and every one of them!!" But I am guessing most savvy investors would recognize that for the death spiral it would be.

Seems to me that if we have lost so much market share, 30% I believe you alleged, that we have a lot of room to make up on volume. I think we've lost a lot of the market by ignoring the little guys: garage businesses and eBay shippers for example. Those little fish grow up to be big fish sometimes, and they remember who helped them out in the early days. Companies like Southwest seem to do just fine refusing to go along with price increases & making it up on volume. They don't have particularly low labor costs and I can't see their fuel or equipment costs being any different as everyone flies either Boeing or Airbus. I think if just one year we said we weren't increasing rates Fedex could match that but do it two or three years and they start having trouble. Just not increasing the rate on Ground and improving our Time-in-Transit would stop the growth that FDXG is having. Their air operation is hurting so we could hold the line there and not lose money.

As for the savvy investors, I'll say that going public was the worst thing UPS ever did for so many reasons. I think we have enough cash to buy all that stock back and still not have to borrow if we held the line on rates for a while. My vote for a slogan would be to return to "Tightest Ship in the Shipping Business".

 

[pretzel_man]

P, what was rps daily volume in 1997...and what was UPS ground volume for the same year???

I really do not know, but I'm thinking RPS was well under 1 million.... I only say that because I remember when they crossed over the 1M mark... I think they were FedEx by then.... Again, I'm not sure.

I've tried looking before. Maybe I didn't look hard enough.

 

[pretzel_man]

P, what was rps daily volume in 1997...and what was UPS ground volume for the same year???

I still do not know the answer, but I did find this 2003 article from CNN Money:

"UPS still hogs the ground-delivery roadway with a 71 percent market share. But FedEx Ground--which just a few years ago was a sideshow to its $16 billion global air-delivery business--hit 14 percent market share in 2002. With revenue growing at a 26 percent annual clip and operating profit surging (up 47 percent in the fiscal year that ended in May), it's on track to swipe another 7 percent of the market by 2007. UPS, by contrast, has lagged behind: Revenue for ground-package shipments grew a measly 0.2 percent in 2002, while overall U.S. operating profit fell 1 percent.

FedEx CEO Fred S saw his opening in 1997--during the 15-day Teamster strike by UPS workers. "He called to ask if I was interested in combining our companies," says FedEx Ground CEO Daniel Sullivan, who was then running RPS, a Pittsburgh-based ground-delivery firm that had become UPS's biggest rival, with annual revenues of $1.7 billion. In 1998, FedEx acquired RPS. Smith put Sullivan in charge of the division--rechristened FedEx Ground in 2000--and the new unit began to claw its way into UPS's market."

 

[CaptainObvious]

Labor costs can be associated with management....is this not correct?

Not sure what you mean by associated?

Are you saying management are a type of labor cost to a company? If so, then absolutely, this is a type of labor cost. UPS has worked to control the rise of this cost by reducing management's health benefits package and shifting a portion of the cost of that package onto management employees, reduced raises, eliminated the defined benefit pension for management since 2008, and reduced the ranks etc.

All good ideas for a company trying to control rising costs, but as I have said, this is one of the smaller costs.

Reducing managements benefit package since 2008. Hmmm....Isn't that when Mr. Davis became the CEO?

I would say giving out a 22 percent comp. package to the CEO would be a HUGE cost.......Especially during the hard economic times we are facing.....While the rest of management got kicked in the balls.


Just pointing out the OBVIOUS.

 

[soberups]

I get that you would rather screw over, as you put it, those in management than the Teamsters employees of UPS. Given that you are in the Teamsters, plus adding in the fact that you clearly despise those of us in management, I find that completely understandable. You will be happy to know that since the 1997 failure to share the burden of controlling rising costs with the Teamsters, UPS has been doing just that, and screwing over Management. Benefits have been cut, and part of their cost shifted to management employees, the ranks have been and continue to be thinned. From a cost containment stand point, all well and good.

In 1999, when we went public and the stock split, there were several management people in my building who became millionares overnight. If my memory is correct, I think I got a $.65 per hour raise that year. I didnt begrudge them their millions; like me, they had made a career choice and like me they soon learned that the choice carried with it both benefits and consequences. Speaking for me personally, I dont "despise" management; I merely recognize the fact that we are and always will be a labor-intensive service industry and anybody who is busting their ass on a belt or in a package car or feeder truck is to some degree carrying the dead weight of those who arent. The customers arent paying for reports or spread sheets or conference calls, they are paying to have their packages delivered.

 

[Returntosender]

The victory points from last contract.

 

[UpstateNYUPSer(Ret)]

Sober, there were drivers who also became quite wealthy as a result of the IPO. We had a driver who converted his thrift plan in to $1.8M in stock.

 

[soberups]

Sober, there were drivers who also became quite wealthy as a result of the IPO. We had a driver who converted his thrift plan in to $1.8M in stock.

Yes, but my point still stands. Anybody who chooses to go into management does so with a clear view of both the risks and rewards associated with that choice. I have little to no sympathy for any management person who was naive enough to buy into the "partnership" lie when they put their letter in.

 

[moreluck]

Yes, but my point still stands. Anybody who chooses to go into management does so with a clear view of both the risks and rewards associated with that choice. I have little to no sympathy for any management person who was naive enough to buy into the "partnership" lie when they put their letter in.

Don't know if it's handled the same way but, my hubby was taken to dinner by a higher up.....just them and numbers were written on a bar napkin.

He kept that napkin for a long time.....turns out the 'upper' didn't figure enough !! His choice to go into upper level mgmt. was a good decision and that's when he was sent from Cleveland to Utah for opening up the West. He was in personnel ( that's what they called it in the dinosaur days)

 

[brownIEman]

In 1999, when we went public and the stock split, there were several management people in my building who became millionares overnight. If my memory is correct, I think I got a $.65 per hour raise that year. I didnt begrudge them their millions; like me, they had made a career choice and like me they soon learned that the choice carried with it both benefits and consequences. Speaking for me personally, I dont "despise" management; I merely recognize the fact that we are and always will be a labor-intensive service industry and anybody who is busting their ass on a belt or in a package car or feeder truck is to some degree carrying the dead weight of those who arent. The customers arent paying for reports or spread sheets or conference calls, they are paying to have their packages delivered.

I think you are missing my point. There is no reason you should begrudge the millions they made. Nor should anyone, least of all me, begrudge you the $.65 an hour raise you got that year or the raises you've gotten since. It is not about begrudging, or sympathy, or any moral or emotional issue. I am talking about economic numbers. The millions that those owners made came from the market. They did not impact UPS operating cost one iota. Your raise did and the ones you have gotten since, did.

I think you and others misunderstand what I am saying about management costs being cut through compensation draw backs and staff reductions. I am certainly not looking for sympathy. I am trying to get a point across to those who suggest we should cut out management staffing and pay in order to reduce costs enough to become more competitive on our pricing. The point I am trying to convey is that there is not much blood left in that stone. We will continue to squeeze it, I have no doubt. There is not much left there to save, and it always was a smaller portion of our costs than is the compensation to hourlies. Again, as it should be.

So far, UPS has found no way to control those rising costs. So it has done the only thing it can. Increase the push for production. That has been successful from a profitability stand point, but not from a competitive stand point. If the slide in market share continues at around 2%/ year, in 25 years UPS is out of the domestic small package market.

 

[brownIEman]

Reducing managements benefit package since 2008. Hmmm....Isn't that when Mr. Davis became the CEO?

I would say giving out a 22 percent comp. package to the CEO would be a HUGE cost.......Especially during the hard economic times we are facing.....While the rest of management got kicked in the balls.


Just pointing out the OBVIOUS.

Actually, the reduction in benefit packages started long before 2008. I cannot remember exactly when we moved to the "choice" or whatever packages, I believe it was something like 2003?

Far be it from me to defend Mr Davis, but that ship was already sailing when he took the helm.

As for his raises, they are peanuts in the grand scheme of UPS overall costs, and taking him down to zero compensation would not make much of a dent in our overall costs structure.

It would improve my moral by a fair amount though.

 

[104Feeder]

I think you are missing my point. There is no reason you should begrudge the millions they made. Nor should anyone, least of all me, begrudge you the $.65 an hour raise you got that year or the raises you've gotten since. It is not about begrudging, or sympathy, or any moral or emotional issue. I am talking about economic numbers. The millions that those owners made came from the market. They did not impact UPS operating cost one iota. Your raise did and the ones you have gotten since, did.

I think you and others misunderstand what I am saying about management costs being cut through compensation draw backs and staff reductions. I am certainly not looking for sympathy. I am trying to get a point across to those who suggest we should cut out management staffing and pay in order to reduce costs enough to become more competitive on our pricing. The point I am trying to convey is that there is not much blood left in that stone. We will continue to squeeze it, I have no doubt. There is not much left there to save, and it always was a smaller portion of our costs than is the compensation to hourlies. Again, as it should be.

So far, UPS has found no way to control those rising costs. So it has done the only thing it can. Increase the push for production. That has been successful from a profitability stand point, but not from a competitive stand point. If the slide in market share continues at around 2%/ year, in 25 years UPS is out of the domestic small package market.

Using a figure of $30,000/yr for wages & benefits for a part/time supervisor, which I think you will agree is a fair figure; I could cut $1.4 million from the UPS budget in the Phoenix building if I cut just a dozen supervisors from each of the 4 shifts. I think the impact to our productivity would be minimal, but Verizon will be complaining about all those customers going to Cricket for cheaper texting plans.

 

[brownIEman]

Using a figure of $30,000/yr for wages & benefits for a part/time supervisor, which I think you will agree is a fair figure; I could cut $1.4 million from the UPS budget in the Phoenix building if I cut just a dozen supervisors from each of the 4 shifts. I think the impact to our productivity would be minimal, but Verizon will be complaining about all those customers going to Cricket for cheaper texting plans.

I think you deeply underestimate the amount to which both production and service would drop under your scenario. The production would not drop much at first. As soon as your loaders and unloaders figured out there was no one there instilling a sense of urgency, they would slow down. And if they had misloads, well, they would likely not even know about them, much less get overly excited. I have seen it, both in Preloads, Hubs, and Package centers. Just a 10% drop in production would likely wipe out about half of your $1.4 million. Let it slide another 10% and you are back to even. Let alone the cost of the increase in service failures. Not to mention the fact that if OSHA shows up for something and you have no compliance documentation kept up to date in your operation, the fines would make those PT sups that used to do those documents look pretty cheap.

You may have too many pt sups in that building, so getting rid of a few might help, but eventually you will hit a point of diminishing returns and actually start going backward. And even if you saved the $1.4 million for all the management you mention, that is not even close to the largest cost in that operation. Not even close.

 

[menotyou]

The loss is one sup in my building would not affect any of the stuff you talk about, except service. Why? Because they have cut the preload sort to where a sup's two hands are needed to touch packages in order to get out the door somewhere around 9am. That same sup walks out the door 20 minutes later, as his shift is over. He starts 20 minutes before the sort. He doesn't do any paperwork. The dispatch/FT preload sup does all that. Had UPS not gutted the preload and made the Godforsaken number so impossible to maintain, service wouldn't be an issue.

 

[104Feeder]

I think you deeply underestimate the amount to which both production and service would drop under your scenario. The production would not drop much at first. As soon as your loaders and unloaders figured out there was no one there instilling a sense of urgency, they would slow down. And if they had misloads, well, they would likely not even know about them, much less get overly excited. I have seen it, both in Preloads, Hubs, and Package centers. Just a 10% drop in production would likely wipe out about half of your $1.4 million. Let it slide another 10% and you are back to even. Let alone the cost of the increase in service failures. Not to mention the fact that if OSHA shows up for something and you have no compliance documentation kept up to date in your operation, the fines would make those PT sups that used to do those documents look pretty cheap.

You may have too many pt sups in that building, so getting rid of a few might help, but eventually you will hit a point of diminishing returns and actually start going backward. And even if you saved the $1.4 million for all the management you mention, that is not even close to the largest cost in that operation. Not even close.

Well, it's nice to know that you have so little confidence in the current management at UPS to instill our work ethic that it's worth wasting millions each year so that 20-somethings can update their Facebook & text about how much they are going to drink later. I don't have much sympathy since the last few decades UPS has chosen to hire the worst dregs of society instead of the College kids we used to hire. Not that you can't instill our work ethic into most anyone (and especially since we give you 90 days to do it), but there is absolutely no effort made even with the abundance of Polo shirted worthless bodies we have now. I have gotten up in the trailers and helped our loaders, and I notice their production suffers more because of the scanning than because they are slow. When I loaded we did a six sided check and built the wall. Now it's the check, attempt to scan, attempt again, slowly type in the barcode. When I was a loader, we had one supervisor on the "West Wall" which was 25 doors. One in the unload (8 peninsulas), one in the sort aisle, one in the small sort (who also did the NXDA sort), and one on the "White belt" which was 10 doors & he also was in charge of the irreg drivers. Now it's one supervisor for 5 or 6 doors. How did we ever get it done then?

I think you are either stuck in your way of thinking or didn't work here when we used to do it differently. Unfortunately, your view seems to be the pervasive one. Instead of just saying I despise management, say I despise today's management and it's because I lived through better. When I was hired, your supervisor looked out for you, he was never looking to get you. Supervisors were very protective of their crews, so much so that I almost saw a fistfight break out after a load wall Supervisor "stole" and unloader from another one. I'm not saying it was harmonious, but we were all in College & it was a good job to get you through school. I can't say it's that way today and none of the kids I ask in the hub are in school, nor do they plan on making UPS a career. Some of us looked at it as getting paid to work out, others just liked the pace. When you were salted, you just fired that salt back at the Sup & he would smirk and walk away (even if you almost hit him in the head). There wasn't any paperwork, mistakes were settled with a verbal dressing down. Of course back then you respected your supervisor also because he dressed like one, not the slackers in polos & shorts we have today. Of course this is all in some way the fault of the Teamsters.

Nice to know that UPS has some fear of OSHA, but they would just forge those compliance documents here after giving the inspector the runaround until he left.

If $1.4 million is not worth saving, how about throwing it my way?

 

[brownIEman]

104feeder,

You are talking about an entire cultural change. You want to imagine that I blame that on the teamsters, I do not. It does however, take two to tango and I believe there is enough blame to go around.

When you and I worked in the hub, yes, even the part time supervisors, who were young kids for the most part, wore suits and ties. They dressed more professionally, were treated with more respect, and I think, acted more professionally. That is much different now. You could claim to me that you have never violated the contract by treating one of the current part times sups you have dealt with in a disrespectful way, but I would not believe you.

It was a much different job back then. You are correct, we did not scan everything we loaded into the feeders. As a consequence, we loaded much faster. One of the reasons you see a sup for 5-6 doors now is those doors have as many loaders to supervise as the entire wall did back then. Even though, the scanning technology we use is not nearly as bad as you are claiming. If the loader you were helping was trying to pretend every bar code was not scan-able and had to be typed in, they were sabotaging the operation. If we screwed up back then, yes, we got a dressing down. Today, if that was tried, the response would not be "Sorry Travis, I won't do that again", it would be- "This is harassment, I want my steward", or "I am doing the best I can".

There was a lot of paperwork done by the PT sups back then. Compliance and reporting paperwork. Mostly it was done either before the sort or after. It was not uncommon for those guys to work 6 or 8 hours everyday. They got no extra for that, they were salaried. UPS got sued for that, which is why it is not really a salaried position anymore and they are held to 5.5 hours per day. That is another reason there are more of them.

Yes, most of us were in college. Very few of us planned on making UPS a career. Certainly we did not plan on loading feeders to be a career. But remember, that was part of Carey's argument back in 1997, "Part-Time America Doesn't work!". A big part of that fight was to make loading feeders a full time career.

It has been more than 20 years, and I don't remember a lot from my loading days. I remember getting max density t-shirts from the load sheriff. I remember loading Salt-Lake, Worcester, Toledo, and I think Lenexa Kansas(?) on the white belt. I remember getting a t-shirt for loading more than 16,000 pieces with no misloads. I remember unloading in the metro unload, Heavy industrial P/U routes on Pens 4 and 5, and competing between myself and the other unloaders to see how fast we could clear out a pen. We took pride in our job, and I do not remember anyone saying "hey, why are going so fast, don't you get paid by the hour?" It was a different culture back then.

 

[104Feeder]

Well since you agree the culture has changed, is it really so hard to change it back?

Certainly I am guilty of treating them with disrespect now, usually prompted by their refusal to honor even a simple request such as "What is your name?"(had that happen more times than I can count. Whatever happened to the name tags?). Now I just speed-dial their manager if I get any guff & he handles it without ever going to paper. I've had a 5 minute supervisor working grievance for $6.58 sent so me via Saturday Air so he knows not to screw around. I shouldn't have to go that route though, it should be something I can handle with conversation.

I don't agree that the job itself has changed that much. Boxes still come down a belt and go into a trailer. Perhaps we should pull back from the scanning on Ground, as you read anyone's review of it when they have a problem and it's less than perfect. Maybe we could go with RFID in the form of tape that would pick up it's progress automatically. I can't remember the last time I tracked a package myself, and I get deliveries every day from multiple carriers for my side business. If there is a problem the vendor just usually sends a replacement instead of wasting time finding out what happened to it.

Not sure how those PT sups got so many hours back then as they seemed to make it to the bar faster than we did on Thursday nights.

Carey just wanted to reduce part-time jobs in general, and I think that was a good strategy. His request was for a number of conversions, not really specific ways to do it. We set up the framework for combo inside/driving jobs & whatnot, but in many buildings the Company could just make a Twilight/Midnight or Midnight/Preload jobs the norm and fulfilled the requirement without ever putting anyone in browns.

I think I left the hub just as "Max Density" was coming in, but I remember them handing out T shirts at monthly meetings where the Sups gave a little speech about the employee before they handed it out. I went into driving with the same attitude about "getting it done" but no one ever told me I was going too fast. Management drilled that into me by hammering on every little mistake. It was simmering to that point, but I will agree that the 1997 Strike was the flashpoint that led many of us to stop working for UPS and in some ways work against UPS. The waves of discipline came on like a torrent after the stoppage and have never let up. While we workers, only half of us Teamsters in AZ, may have failed to pass on the Solidarity gains made in 1997; it seems we have successfully passed on the mentality to only do the minimum necessary to keep you out of the office.

Perhaps it is the corporatization of UPS that is to blame also. Sure, we've been a corporation for decades, but only since about 2000 or so has Company been so inflexible & management been so centralized. When I was trained as a package driver, I wasn't actually trained in the Methods as they were written at the time. It wasn't till after I became a Steward that I actually got a copy and found out how much I had been shown was wrong. Since I was being hammered on the methods instead of being allowed to be creative to "get it done", I learned those methods better than my supervisors & used them against them. It's always been my complaint that UPS sets up the rules of the game against you, then tries to hide those rules & has a hissy fit when you learn them & actually follow them. Same game in Feeders although we have the DOT on our side and if they really want to play hardball there is a lot more we can do, and be protected in doing so.

Seems to me that we have taken 10-15 years to really bring this Company to a low point as far as relations go. Why not commit to putting it on track back to the way it was? As a Steward, I learned to accept incremental change long ago and I can point to contract language that I have been directly responsible for as a measure of success. Isn't it time Management stood up to Atlanta and tried the same thing?

 

[104Feeder]

I'd like to add that when I came into Feeders the message was "Let Package go, we don't treat you like that" and it was true. When you reported for work it was "Mr. Jones" "Mr. Smith" etc from your Dispatcher and it went on from there. Now that culture is changing and you have these 30 day wonders who have never done our job, much less driven a package car, hammering us on the most ridiculous things & full of inaccurate "knowledge" from the Company. Still better than Package but eventually they will get the pushback of "Hey, I get paid by the hour" and "I'm only doing my best" as you are familiar with. Is this what we really want?

 

[JonFrum]

Sober, there were drivers who also became quite wealthy as a result of the IPO. We had a driver who converted his thrift plan in to $1.8M in stock.

You've mentioned this a number of times before. And each time I find myself wondering how can this be so.

$6 contribution per week, times 52 weeks in a year, equals $312 per year. Times, say, 35 years equals $10,920 in contributions. Now add earnings, (which were limited in later years by a plan rule,) and, well, you explain it from here on . . .