The Delivery Business Shows Why Unions Are Struggling to Expand

Last year, two unions representing workers at three large automakers and UPS negotiated new labor contracts that included big raises and other gains. Leaders of the unions — the United Automobile Workers and the Teamsters — hoped the wins would help them organize workers across their industry.

The U.A.W. won one vote to unionize a Volkswagen factory in Tennessee last month and lost one this month at two Mercedes-Benz plants in Alabama. The Teamsters have made even less progress at UPS’s big nonunion rivals in the delivery business, Amazon and FedEx.

Polling shows that public support for unions is the highest it has been in decades. But labor experts said structural forces would make it hard for labor groups to increase their membership, which is the lowest it has been as a percentage of the total work force in decades. Unions also face stiff opposition from many employers and conservative political leaders.

The Teamsters provide an instructive case study. Many of the workers doing deliveries for Amazon and FedEx work for contractors, typically small and medium-size businesses that can be hard to organize. And delivery workers employed directly by FedEx in its Express business are governed by a labor law that requires unions to organize all similar workers at the company nationally at once — a tougher standard than the one that applies to organizing employees at automakers, UPS and other employers.

Some labor experts also said the Teamsters had not made as forceful a push as the U.A.W. to organize nonunion workers after securing a new contract with UPS.

“You didn’t have that energy that you saw with the U.A.W.’s leaders,” said Jake Rosenfeld, a sociologist who studies labor at Washington University in St. Louis.

Teamsters officials said the UPS deal, which increases the average annual compensation, including benefits, of a UPS driver to $170,000 from $145,000, was helping them gain members. At DHL, a delivery company where the union has long had a big presence, the union added 1,100 members last year and is pushing to gain another 1,500. The Teamsters are also pursuing a legal challenge against Amazon that could allow them to gain ground at the company and its contractors.

“It’s been very helpful for us to mobilize,” Sean O’Brien, the Teamsters’ president, said in an interview, referring to the UPS contract. “We’ve set the standard in the industry.”

But the union has also suffered losses. Yellow, a trucking company that employed 24,000 Teamsters, shut down and filed for bankruptcy protection last year.

Amazon and FedEx said they were confident in their approach to managing and compensating workers. Amazon said it had made investments that bolstered pay and benefits at its delivery contractors. FedEx said its nonunion model allowed it to quickly increase pay whereas UPS’s union employees were bound by the terms of five-year contracts.

“Our culture, built and tested over 50 years, is based on the philosophy that if we take care of our people, they will deliver outstanding service for our customers, which will drive business results for our company,” Tracy Brightman, FedEx’s chief people officer, said in a statement,

Around 310,000 UPS employees belong to the Teamsters. Many of them see FedEx and Amazon drivers on their routes and talk about pay, benefits and working conditions.

“We make much more money than anyone else in the industry,” said Essence Carlisle, a part-time package handler at UPS’s hub in Louisville, Ky. “I definitely intend to make a career here.”

The UPS deal gave part-time employees, over half the company’s unionized work force, a 26 percent raise, to at least $21 per hour. Ms. Carlisle makes close to $24 an hour and works around 20 hours a week, giving her time to run a bakery on the side, she said. Her friends who have full-time driving jobs at Amazon make around $19 an hour, she said.

As big as the raises at UPS were, they did not increase pay by a lot more than inflation. The top wage rate immediately after the latest deal, $44.25 per hour, was 22 percent higher than five years earlier. Over that period, consumer prices rose 21 percent.

And UPS typically hires new union workers into part-time jobs, which they hold for a few years. As a result, some people may be unwilling to seek a job at the company.

Even so, last year’s Teamsters contract was widely discussed online, spawning memes of UPS drivers arriving at customers’ doors in designer clothing.

“Joking or not, everybody was like, ‘Hey, man, I need a job at UPS,’” said Juan Martinez, a UPS driver in Southern California.

Under the new contract, Mr. Martinez expects to earn $110,000 to $120,000 a year, depending on how much overtime he gets, he said. He said his income allowed him to spend more on his children’s education.

Under the Teamsters’ deal with UPS, the top hourly wage will increase to $49 by the end of the five-year contract. Amazon said in January that the average pay of workers at its delivery contractors was $20.50 in the United States. FedEx declined to provide an average wage rate for its delivery workers.

Despite UPS’s superior pay over the years, the Teamsters have not made many inroads at FedEx or Amazon.

The high turnover of delivery and warehouse workers at Amazon and FedEx — where each part-time position was on average filled and vacated twice last year — makes it difficult to organize them.

Another challenge is that delivery workers at Amazon, and drivers who deliver for FedEx Ground, are employed by contractors. Mr. Rosenfeld, the labor academic, said trying to organize a few dozen people at each contractor could be time consuming and costly.

Last year, 84 workers at an Amazon contractor near Los Angeles joined the Teamsters. But days earlier, Amazon terminated the contract with the operator, Battle-Tested Strategies, the company said, for failing to follow proper safety procedures, among other things.

The Teamsters asked the National Labor Relations Board to rule that Amazon was a joint employer of the workers and order the company to reinstate the contract. The board has yet to rule.

A favorable ruling would be “a massive deal” and an “inspiration for thousands of other workers across the country,” said Randy Korgan, a Teamsters official.

Johnathon Ervin, the owner of Battle-Tested Strategies, said he believed Amazon had terminated the contract, which led to job losses for all his employees, because of the unionization effort. An Amazon spokeswoman, Mary Kate Paradis, disputed that.

Mr. Ervin said the minimum pay for his workers under the Amazon contract was $19.75. “If you are asking people to make this a career, you should have better work conditions and pay the drivers more,” said Mr. Ervin, a 26-year Air Force veteran.

Amazon didn’t respond directly to that criticism. The company noted that its contractors, which it refers to as delivery service partners, had created 279,000 driving jobs over the last five years.

“Helping D.S.P.s create a good overall working experience is important to us, which is why we’ve invested more than $8 billion in state-of-the-art technology, safety features, rates, programs and services for Amazon D.S.P.s and their drivers,” Ms. Paradis said in a statement.

Labor groups have made some gains at Amazon, including organizing workers at a Staten Island warehouse. But Amazon is challenging the election there, and that union has been embroiled in infighting.

At FedEx there is another potential barrier to unionization.

FedEx was founded as an airline, and employees of its Express business come under the Railway Labor Act, which requires unions to organize nationally, across a whole company, at once. Union officials say it’s easier to hold individual votes at each company location as allowed under the National Labor Relations Act, which governs workers at UPS and automakers.

Even so, some FedEx employees do belong to a union. Nearly 6,000 pilots at FedEx Express are represented by the Air Line Pilots Association. The Teamsters are trying to organize the mechanics who work on the company’s planes.

FedEx said its delivery workers had benefited from not being in a union because the company raised wages significantly during the home-delivery boom of 2021 and 2022, when UPS workers’ raises were set by an agreement reached before the pandemic. A FedEx spokeswoman noted that the company incurred an additional $1.4 billion in labor costs in its 2022 fiscal year.

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Kim browne

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