Feds to Try to Settle FedEx Dispute
Monday November 16 10:33 AM ET
Feds To Try To Settle FedEx Dispute
MEMPHIS, Tenn. (AP) - Representatives from FedEx Corp. and its pilots union are reportedly hoping federal
mediators can resolve a labor dispute that could paralyze the company during its busy holiday delivery season.
Officials from the Fedex Pilots Association and the company planned to meet today with members of the National
Mediation Board in Washington to try to reach an agreement, The Wall Street Journal reported today.
The board has tried to get the two sides talking again since negotiations broke off Oct. 30.
The company has offered the pilots a 17 percent raise over five years. The union wants 5 percent retroactive to a
negotiated date and 19 percent more over four years.
FedEx says its pilots make an average of $142,000 a year, though the union contends that figure is inflated with overtime
pay.
FedEx pilots last week started refusing to work overtime and the union sent out strike authorization ballots. If two-thirds
of the pilots give authorization, the union may call a strike. The ballots are expected to be counted Dec. 3.
Last Friday, the union called for binding arbitration on a work contract, but company officials rejected the idea.
Meantime, FedEx continues to reconfigure its delivery network to rely more on ground transportation if pilots strike.
Company officials say they believe the system will allow the company to return to profitability within three months of a
walkout.
''The financial hit will be limited to the first 90 days of the strike period, and thereafter we should be able to get back on
our feet,'' said Alan Graf, executive vice president and chief financial officer at FDX Corp. (NYSE:FDX - news),
FedEx's parent. Still, ''all the scenarios of a strike are very bad short-term scenarios.''
During a strike, overnight deliveries would not be available in some areas and international deliveries would be extended
by one day, company officials say. But the company still would maintain its money-back guarantees on two- and
three-day deliveries, which constitute one-third of FedEx's business.
Company officials have said they will negotiate with large customers to shift parts of their overnight volume into the
company's slower delivery services.
''Over time, as we're able to put back more of the air network, we'll be able to expand the areas where we can offer
overnight,'' Graf said. ''How quickly we can provide a nationwide overnight service will of course depend to a large
degree on how many FedEx pilots come to work.''
Federal Express, based in Memphis, is the world's largest air cargo delivery company with 326 cargo jets. The pilots are
FedEx's only unionized workers in the United States. |
