FedEx contractor revolt?

[bbsam]

We're all in the gallows but don't forget this Corp is playing both sides. Employees and contractors. Network 2.0 plan isn't set in stone and could go either way.

And that’s why embracing what Patton is talking about would be smart on their part.

 

[floridays]

And that’s why embracing what Patton is talking about would be smart on their part.

Simpily, what is he proffering?
I'm curious.

 

[bbsam]

Simpily, what is he proffering?
I'm curious.

A lot of it is purchasing as a group. Has a fuel card with a negotiated $0.10 off per gallon (up to $0.25 per gallon). A tire program with Bridgestone. Purchasing/leasing program (lower prices) with Ford. Insurance program with Realm Health. Dividend check of up to 10k per year.

Definitely trying to strike a tone of partnership with Ground if Ground is willing to be a partner.

 

[bbsam]

The downside for FedEx is that Patton is leading by example. He’s done seminars in the past about supplementing settlement with contingency. It’s a lucrative business that has literally made millionaires.

He’s stepping away from that lucrative side of the business. In his words, it’s propping Ground up in ways that are detrimental to the long term health of the company.

He doesn’t tell others what to do but he’s got the entire networks attention.

Friday after Thanksgiving will be interesting. He openly says that if things can’t be addressed with the company by then, his financial health will require the sitting of line haul and P&D operations.

He’s actually guiding them kicking and screaming to where they should want to be with contractors.

 

[floridays]

A lot of it is purchasing as a group. Has a fuel card with a negotiated $0.10 off per gallon (up to $0.25 per gallon). A tire program with Bridgestone. Purchasing/leasing program (lower prices) with Ford. Insurance program with Realm Health. Dividend check of up to 10k per year.

Definitely trying to strike a tone of partnership with Ground if Ground is willing to be a partner.

Unless I don't understand I don't see how Ground would even be affected or care if you did these.

It may be viewed as a shot across the bow.
They would know that contractors actually found a need to be affiliated but none of these acts put pressure on Ground.

I'm certain I must be missing something.

I have another question.

In brokering these deals who will the initial beneficiary be, where will this dividend check come from, and where do the funds for the potential dividend originate?

I thought the contractors had larger issues.

 

[bbsam]

Unless I don't understand I don't see how Ground would even be affected or care if you did these.

It may be viewed as a shot across the bow.
They would know that contractors actually found a need to be affiliated but none of these acts put pressure on Ground.

I'm certain I must be missing something.

I have another question.

In brokering these deals who will the initial beneficiary be, where will this dividend check come from, and where do the funds for the potential dividend originate?

I thought the contractors had larger issues.

The pressure on Ground is partially imaginary, partially financial, and partially of their own making.

They and others have from the beginning tried to cast this as the beginning of a unionizing event. It’s not. Calling this a union is like calling Obamacare socialized medicine.

It’s also not a cure all. Contractors have been bleeding money for months and while these initiatives will absolutely help, many are so deep in that without company assistance to basically get back to even, will fall before peak.

The company has been invited to engage in meaningful dialogue and has flat out refused. The company line about negotiating with individual contractors has become a punchline. They’ve dug in their heels and left a wide open leadership role. At one point during his speech I commented to others that this is the speech John Smith should have given.

Make no mistake about it. The network is in serious peril. The company is in serious danger of massive failure. Patton and TALP represent a viable and innovative beginning of a framework to righting the ship. In a lot of ways, this helps the efficiency FedEx has always pushed contractors towards. In the past, they’ve always found a way to take it from the next contract.

As far as the dividend checks go, I have to admit I’m not clear on those details. I think I cut away for a moment to text the other contractors something humorous. Im sure in the coming days there will be highlight videos available.

 

[zeev]

Unions and Ground contractors have absolutely nothing to do with each other , contractors have assets vital to the business

 

[zeev]

Employees without a union are homeless people it’s a tin cup begging for a step raise that is not coming.

 

[bacha29]

I think you see this organizing (which you say doesn’t exist) as a union. It really isn’t. He’s done his homework and has substantial money saving agreements already in place. Probably things FedEx should have put in place years ago.

So he has been able to negotiate some bulk and group savings on materials and supply contractors use? That's nice. So do you actually believe that FDX doesn't know about those economies and therefore will not use their existence as a way to drive a harder bargain with contractors? Of course they know it and most definitely will use it to drive rates down. So while Patton's intent was to try to find ways to put money in contractors pockets, in reality all he's doing is to putting money in FDX's pocket.

Again, the only contractor benefiting outcomes that will actually matter are those he can win in court because those are the only ones that are binding upon FDX. And due to the fact that there is in place a governing legal authority with the power to make them binding. And as I'm sure you know what lies at the heart of the matter and that is that FDX has been playing too loose with the law for far too many years.

 

[bbsam]

In the past, they’ve always found a way to take it from the next contract.

@bacha29

So he has been able to negotiate some bulk and group savings on materials and supply contractors use? That's nice. So do you actually believe that FDX doesn't know about those economies and therefore will not use their existence as a way to drive a harder bargain with contractors? Of course they know it and most definitely will use it to drive rates down. So while Patton's intent was to try to find ways to put money in contractors pockets, in reality all he's doing is to putting money in FDX's pocket.

Again, the only contractor benefiting outcomes that will actually matter are those he can win in court because those are the only ones that are binding upon FDX. And due to the fact that there is in place a governing legal authority with the power to make them binding. And as I'm sure you know what lies at the heart of the matter and that is that FDX has been playing too loose with the law for far too many years.

You mean what I’ve already stated?

I wouldn’t trust this in the courts at all. This isn’t going to be drawn out over years. There will be noticeable movement toward resolution by peak season. Nothing has changed in the landscape as far as Ground’s perilous state. I really thought you were beginning to understand but you’ve slipped back into your grudging admiration of FedEx brass.

They still have no replacement for contractors. There aren’t enough contingency teams. The contracts are crap. Morale is in the crapper. Businesses are going broke.

And ERC checks are beginning to arrive.

FedEx is not in an enviable position.

 

[bacha29]

@bacha29


You mean what I’ve already stated?

I wouldn’t trust this in the courts at all. This isn’t going to be drawn out over years. There will be noticeable movement toward resolution by peak season. Nothing has changed in the landscape as far as Ground’s perilous state. I really thought you were beginning to understand but you’ve slipped back into your grudging admiration of FedEx brass.

They still have no replacement for contractors. There aren’t enough contingency teams. The contracts are crap. Morale is in the crapper. Businesses are going broke.

And ERC checks are beginning to arrive.

FedEx is not in an enviable position.

Once again you're hauling under FDX Ground's DOT number and currently the only freight you have to haul is FDX Ground's freight. Who else's do you have to haul? Sure if you had your own road tractor's and your own rights you could lease onto somebody else tomorrow . But, if all you've got is panels and steps not much in the way of alternative uses for them.

You're wrong if you think I'm in Fat's and Raj's camp. At the same time however you can't ignore the fact that they've got the rights and the freight.

Now like you said, this will be resolved by peak. Indeed it will be because FDX will offer a few pennies more than they had originally plan to offer and the vast majority of contractors many in desperate economic straights will jump all over it and Patton's coalition will disappear into the mists.

 

[bbsam]

Once again you're hauling under FDX Ground's DOT number and currently the only freight you have to haul is FDX Ground's freight. Who else's do you have to haul? Sure if you had your own road tractor's and your own rights you could lease onto somebody else tomorrow . But, if all you've got is panels and steps not much in the way of alternative uses for them.

You're wrong if you think I'm in Fat's and Raj's camp. At the same time however you can't ignore the fact that they've got the rights and the freight.

Now like you said, this will be resolved by peak. Indeed it will be because FDX will offer a few pennies more than they had originally plan to offer and the vast majority of contractors many in desperate economic straights will jump all over it and Patton's coalition will disappear into the mists.

If I have 30 trucks, do you think I could get 300000 for them? If I owe 200000 pocket the rest and bank the ERC, is that a bad deal? Because as things stand today, that the worst possible outcome. I could live with that.

 

[Mutineer]

Now like you said, this will be resolved by peak. Indeed it will be because FDX will offer a few pennies more than they had originally plan to offer and the vast majority of contractors many in desperate economic straights will jump all over it and Patton's coalition will disappear into the mists.

I think your prediction will very closely match what will happen.

Unless enough contractors get angry enough to agree to park their vans all on the same day (and keep them parked) until XG agrees to compensate them fairly.

Patton is an excellent representative to negotiate.

If sooo many contractors are in sooo much peril, why not scuttle the ship and drag the captain and all the officers down with it?

The shareholders will have a cow. Some will have twins and triplets. Metaphorically, there will immediately be executive's heads on sticks.

Make Fred, and all the management toadies squeal.

 

[bbsam]

I think your prediction will very closely match what will happen.

Unless enough contractors get angry enough to agree to park their vans all on the same day (and keep them parked) until XG agrees to compensate them fairly.

Patton is an excellent representative to negotiate.

If sooo many contractors are in sooo much peril, why not scuttle the ship and drag the captain and all the officers down with it?

The shareholders will have a cow. Some will have twins and triplets. Metaphorically, there will immediately be executive's heads on sticks.

Make Fred, and all the management toadies squeal.

The linchpin to the whole thing is line haul. They can simply refuse to run and face zero repercussions. Half those runs sit early peak and the mess gets huge quickly.

 

[bacha29]

If I have 30 trucks, do you think I could get 300000 for them? If I owe 200000 pocket the rest and bank the ERC, is that a bad deal? Because as things stand today, that the worst possible outcome. I could live with that.

Sounds good. Too bad you'll have to pay back all that depreciation you claimed on them.

 

[bacha29]

I think your prediction will very closely match what will happen.

Unless enough contractors get angry enough to agree to park their vans all on the same day (and keep them parked) until XG agrees to compensate them fairly.

Patton is an excellent representative to negotiate.

If sooo many contractors are in sooo much peril, why not scuttle the ship and drag the captain and all the officers down with it?

The shareholders will have a cow. Some will have twins and triplets. Metaphorically, there will immediately be executive's heads on sticks.

Make Fred, and all the management toadies squeal.

Yep, Clearly FDX and Johnny Dollar Sign are convinced that a service suspension will not be broad based enough or last long enough to make any real difference. Especially if JDS and FDX have clearly warned contractors of the serious consequences that are almost certain to occur if they suspend service.

 

[Mutineer]

The linchpin to the whole thing is line haul. They can simply refuse to run and face zero repercussions. Half those runs sit early peak and the mess gets huge quickly.

Is there widespread discontent among the linehaul folks?

And regarding repercussions, I was under the impression that was a paper tiger.

I guess there's no way to find out for sure until someone pokes it with a stick.

 

[It will be fine]

Is there widespread discontent among the linehaul folks?

And regarding repercussions, I was under the impression that was a paper tiger.

I guess there's no way to find out for sure until someone pokes it with a stick.

Yes. Linehaul is getting hit hard with the same cost pressures as P&D. Ground used to be a top carrier to lease on to with high pay and new equipment. They’ve been slipping down quite a bit this year and maintaining staff is hard.

 

[bbsam]

Is there widespread discontent among the linehaul folks?

And regarding repercussions, I was under the impression that was a paper tiger.

I guess there's no way to find out for sure until someone pokes it with a stick.

Yes. Line haul and also been getting the shaft.

It’s very much my opinion that the FedEx threats of “contractual remedies” are fairly lame right now. The number of open routes being filled by contingency for over a year has never been higher. That inability to find suitable contractors speaks volumes.

Whereas in normal conditions FedEx could and would go after contractors who would take part in #purplefriday, line haul has a set number of days when they can simply not run. If contractors on the east and west coasts (liberal leaning) the jams wouldn’t take long to incapacitate the system.

@bacha29 believes some 90% of contractors would need to take part. Obviously line haul by it’s nature could theoretically cripple entire regions.

The tiger has been poked.

 

[bbsam]

Yep, Clearly FDX and Johnny Dollar Sign are convinced that a service suspension will not be broad based enough or last long enough to make any real difference. Especially if JDS and FDX have clearly warned contractors of the serious consequences that are almost certain to occur if they suspend service.

I’d like to know what those “serious consequences” are. I didn’t get that memo. You didn’t either, did you?

What do you think it would take for service disruptions at peak? Nothing going into Chicago for a couple days? West coast line haul taking a long Thanksgiving weekend? Probably exacerbate the situation with weather issues.

Gotta remember that 30% of contractors are line haul. What percentage of those operations service the largest populations?