Union threatens UPS strike

Date: 06.07.2012

TWU to ballot UPS employees in a plan to initiate industrial action over wages and conditions following its merger with TNT Express

UPS strike on the cards

By Anna Game-Lopata | July 6, 2012

Australia’s Transport
Workers Union (TWU) will ballot UPS employees in a plan to initiate industrial action over wages and conditions
at company follwing its merger with TNT Express.

The TWU last year successfully negotiated an agreement to secure improved job security, wage and redundancy provisions for drivers and distribution centre (DC) staff at express transport company TNT Express.

But it says the $6.4 billion acquisition of TNT Express by US-based United Parcel Service (UPS), announced in March, will put the conditions secured by TNT employees in jeopardy.

TWU Acting Secretary Michael Kaine says by law, once the two companies have merged their operations in Australia, UPS management is free to hire staff using either the UPS or the TNT Express agreement for a period of 12 months.

"Given human nature, we are concerned there may be a financial incentive for the company to make use of the cheaper option offered the UPS agreement," Kaine says. "This is clearly not in the interests of our members."

Kaine says TWU officials have been negotiating with UPS representatives in Australia since March with no success.

The most critical issue on the agenda is the call for hired workers at UPS and TNT Express to retain wages and conditions, especially relating to redundancy, on par with the TNT agreement.

"Ensuring site rates for labour hire employees is vital to the job security of both UPS and TNT employees," Kaine says.

"If this provision is not agreed upon then essentially the company could engage labour hire through the UPS agreement and undercut rates of the entire workforce."

In addition, the TWU is calling for the TNT Express agreement to wind up neatly with the beginning of a single agreement for all UPS workers affected by the merger.

According to Kaine, UPS is refusing to ratify a new labour hire clause because it says the company rarely requires extra staff.

"If this is the case, inserting a provision for labour hire conditions in the agreement for
those occasional
instances of overflow shouldn’t be such a sticking point," Kaine says.

"Instead the issue has become a red flag to our members who are concerned the company is planning to increase its quota of hired staff, or may even be considering the replacement of in-house staff with more hired labour," he says.

The TWU represents hundreds of UPS freight forwards including drivers and distribution centre staff, along the eastern seaboard in New South Wales, Queensland and Victoria as well as thousands of members working for TNT across the country.

The union will hold a nationwide ballot for workers affected by the UPS-TNT Express merger on July 16 to vote on whether to take strike action.

"Drivers and DC staff at TNT are well aware of the danger of insecure work and the need for a strong agreement on wage conditions and job security," Kaine says.

"In 2011, after months of negotiations and protected action, the TNT workforce won."

"On 16 July, if the ballot returns show that UPS workers want to pursue their right to strike against the existing threat of insecure work, the TWU will offer its full strength to our members in their fight for a fair deal."

SupplyChain Review approached UPS for a comment but a response is yet to be received.

Meanwhile as reported earlier, industry research company IBISWorld says the Australian activities of United Parcel Service (UPS) and TNT Express are marginal so the merger of the two won’t affect our market very much.

IBISWorld’s Caroline Finch says UPS and TNT Express have a very small share of the transport and postal market compared to domestic giants likeToll, Linfox, QR National or Asciano.

"In 2011-12 IBISWorld estimates that TNT represents 0.8 percent and UPS just 0.07 percent of the integrated Logistics market in Australia," Finch says.

"UPS and TNT combined could offer a better global network to Australian companies. However to my knowledge they aren't bringing significantly better technology or products to the Australian market."