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. Last Updated: 07/27/2016

Labor Secretary Enters UPS Fray

WASHINGTON -- Labor Secretary Alexis Herman has warned United Parcel Service against hiring replacement workers and urged UPS and the Teamsters to resume suspended talks to end a strike that has paralyzed daily delivery of nearly 12 million packages.

"I will be talking with the parties, both for the Teamsters and for UPS, to ask them not to take any action to escalate this strike,'' Herman said Sunday on the CNN program "Late Edition.'' "I believe hiring replacement workers does contribute to that escalation.''

Contract talks between UPS and the Teamsters broke off Saturday, with each side saying that federal mediators have done little to broker a new five-year agreement. Both sides have said they are digging in and preparing for a protracted fight.

About 183,000 Teamsters have been on strike since Aug. 4. The union members work as drivers, sorters and package handlers.

United Parcel Service of America Inc., the nation's largest package-delivery company, has not made a decision whether to hire replacement or temporary workers, said the company's chairman and chief executive, James Kelly, who appeared Sunday on the CBS program "Face the Nation.''

"The last thing we want to do, the last thing I want to do, is replace UPS workers,'' he said, adding that if the strike continues, "I can't make any guarantees about the future. If all our business goes away, there'll be no jobs for any of us to come back to.''

UPS is losing "hundreds of millions of dollars a week'' from the strike, he said. The Atlanta-based company has been able to make 10 percent of its normal deliveries with a 84,000 non-union and management workers. The company has said 5,000 union workers have crossed the picket lines and returned to work.

Teamsters President Ron Carey, appearing on "Face the Nation,'' said hiring replacement workers is "not the answer to the problem.''

"We have good, hard workers, skilled workers who made this company a billion dollars last year,'' he said. "That's not the way to do it.''

With the strike in its second week, many businesses were growing weary of the situation. Economists have predicted that the longer the strike continues, the more likely that UPS's competitors, such as Federal Express, Airborne Express, RPS Inc. and the U.S. Postal Service, will be unable to handle the extra demand for delivery services.

Hospitals and blood banks, for example, have faced delays in receiving products. And some small businesses, from retailers to book publishers, have suspended shipments because they are unable to afford the higher costs charged by other carriers.

"We recognize this is a serious situation, but we're digging in also,'' Herman said earlier Sunday on NBC's "Meet the Press.'' "We're digging in to urge the Teamsters, to urge UPS, to show a willingness to compromise. We want them to show greater flexibility.''

UPS has offered the Teamsters a five-year contract that would allow part-time employees to move into 10,000 full-time jobs as they become available through attrition and retirement. The contract also would create 1,000 full-time jobs by consolidating some double shifts and replace the current pension plan with one the company says will pay retirees an average of 50 percent more than they would receive under the existing plan.

The union opposes UPS' proposal, saying it would create 3,000 fewer full-time positions than under the expired contract. It has said it will not negotiate on a plan to have UPS employees withdraw from the union's multi-employer pension plan. UPS is the largest of 30 companies that contribute to the Teamsters pension plan.

The U.S. Postal Service, meanwhile, started Sunday delivery of priority mail and parcel post in many areas to handle the increase in demand. "The Postal Service is now delivering dramatically increased volumes of mail that rival those we'd experience during the Christmas period,'' said Nicholas Barranca, vice president of operations for the Postal Service.