Why is FedEx Accusing UPS of Being Bailed Out?
By Barry Ritholtz - July 15th, 2010, 10:45AM
UPS lobbyists have buried a short 230-word legislative bailout deep inside the FAA Reauthorization Act of 2009 currently before Congress. It’s worth billions to “Big Brown” at the expense of today’s American economy that thrives on next-day commerce, competitive shipping options and ready access to markets around the world.
I believe the site Brown Bailout is Fedex related.
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July 15th, 2010 at 11:10 am
Related to this video posted by the libertarians over at Reason.tv?
http://www.youtube.com/watch?v=QzZ0nz7XVFo
July 15th, 2010 at 1:11 pm
I believe there has been a FDX UPS skirmish for a while. If I recall correctly, there used to be a site accusing FedEx of treating their drivers like pilots so they don’t have to Unionize — though I can’t find it right now.
July 15th, 2010 at 1:47 pm
Barry – you are off base about this being a bailout of UPS. I read the actual text. It is not a bailout. Instead, it would reclassify the employees of delivery companies that use ground and air transport (which includes UPS) as trucking companies (and Fed-Ex has an EXTENSIVE long-haul trucking transport arm, called FedEx Freight – it used to be Yellow Freight until Fed-Ex bought them).
This would change the rules under which unions can attempt to organize the employees.
Bloomberg’s BusinessWeek published a good, balanced article on this last month (http://www.businessweek.com/bwdaily/dnflash/content/jun2009/db2009068_154641.htm).
In short, because FedEx originally incorporated as an “airline”, a 1926 law requires that any effort to unionize must be done on a national scale. If FedEx’s employees are redefined as employees of a trucking company, then union efforts can be done on a local basis (these are the rules UPS has to play by).
A bailout of UPS? Not hardly!
An effort by UPS to level the labor playing field between it and it’s main competitor? Absolutely!
An effort by Labor Unions to make it easier to organize FedEx? Definitely!
If we want to debate that, great! But let’s leave the phrase “bail out” out of it!
July 15th, 2010 at 1:54 pm
One more thing…when was the LAST time you saw a Fortune 50 company and a major labor union work together to help unionize a company?!?!?!?!?!
July 15th, 2010 at 1:56 pm
Love it. There we go w/ the Union response.
July 15th, 2010 at 6:14 pm
Fedex, which is not an airline, has continued to insist that it is covered by airline union rules, which count a non-vote for unionization as a no vote.
Of course if Fedex didn’t suck as an employer, they would not have to worry about their workers unionizing.
July 16th, 2010 at 9:36 am
It is an interesting discussion nonetheless
July 16th, 2010 at 1:41 pm
FedEx Express, an operating company of FedEx Corp, is an airline (one of the largest in the world) and their drivers are an integral part of their business. If you know how to read manufacture dates on the new Apple I phones, they are being produced in Asia last week and sold to US consumers this week. To think that the drivers do not play a key role in this INTEGRATED and efficient supply chain is a bit silly.
FedEx Freight is a separate operating company of FedEx Corp, which was formed when American Freightways and Viking Freight were purchased by FedEx. This OP CO is not impacted by the FAA bill in any way. Yellow Freight is a separate company all together and a competitor to FedEx Freight.
As for history:
1. Do any of you remember the 1997 “Brownout” when the UPS teamsters went on strike and shut down many companies shipping in the US?
2. UPS tried to get their drivers under the same Railway act that currently governs FedEx, and FedEx supported this action. The teamsters didn’t. So now they are joining with the teamsters to insert the 230 words in the FAA bill that is designed to only impact FedEx.
Call it a bailout or just crap, either way it stinks.
July 16th, 2010 at 11:24 pm
I am very confused. The libertarian response to this is calling it a bailout?
Should those concerned with liberty be asking the very obvious question-
Why does anyone need PERMISSION to organize?