UPS Starts Pilot Furlough Process


.Companies:United Parcel Service, Inc..Press Release Source: UPS On Monday February 8, 2010, 2:35 pm
LOUISVILLE--(BUSINESS WIRE)--UPS (NYSE:UPS - News) today announced plans to furlough at least 300 of its airline pilots, but at the same time continued its effort to find a solution with the pilots’ union that would avert or mitigate the layoffs before they take effect. UPS employs about 2,800 pilots.

UPS has been working with its union, the Independent Pilots Association, for the past year to identify ways to cut operating costs to avoid any pilot furloughs.

Last June, the IPA identified significant savings through voluntary programs such as pilots taking short- and long-term leaves of absence; military leaves; job sharing; reduction in flight pay guarantees; early retirement, and sick bank contributions. UPS subsequently agreed it would not furlough any pilots in 2009.

The two sides have been working cooperatively ever since to identify additional cost-cutting initiatives that would eliminate the threat of layoffs entirely. Subsequent discussions have failed, however, to identify sufficient operating savings.

If the furloughs go forward, they would be phased, with the first 170 pilots receiving notices in 2010. The initial group would be furloughed in May.

“Even though the economy has begun to turn around, UPS anticipates a very gradual recovery and a continued need for belt-tightening,” said UPS Airlines President Bob Lekites. “This is a painful decision for our people, but one that is right for the on-going health of our business.

“But we haven’t given up on this process,” Lekites continued. “We continue to go well beyond our contractual obligation to seek a ‘win-win’ solution to avert furloughs.”

UPS is well recognized for its commitment to employees, and the company strives to build upon its union relationships to maintain its position as an industry leader. For example, UPS and the Teamsters have formed a Competition Committee to identify new ways of making UPS more competitive and to create jobs, both in its package operation and at UPS Freight. A similar process has been in place with the International Association of Machinists for the employees it represents who help ensure the efficient operation of the UPS network.

The pilot furloughs, if required, would be but one of many steps the company has taken over the past two years to match its resources to economic conditions. UPS has engaged in a company-wide, $1.4 billion cost-cutting effort that included a freeze on management salaries in 2009; suspension of the match for 401(k) plans; trimming capital expenditures, and retiring older aircraft.

Most recently, UPS announced on Jan. 8 it was streamlining its entire domestic U.S. small package structure, eliminating 1,800 management and administrative positions across the country.

“Companywide, we will continue to evaluate all opportunities and make adjustments as necessary to ensure our company is well-positioned to emerge stronger than ever as the economy continues to recover,” said Lekites. “We applaud our pilots for the way they’ve joined with UPS in trying to tackle this problem and hope we can identify a mutually beneficial outcome.”

UPS (NYSE: UPS - News) is the world's largest package delivery company and a global leader in supply chain and freight services. With more than a century of experience in transportation and logistics, UPS is a leading global trade expert equipped with a broad portfolio of solutions. Headquartered in Atlanta, Ga., UPS serves more than 200 countries and territories worldwide. The company can be found on the Web at UPS.com and its corporate blog can be found at upside, the UPS blog. To get UPS news direct, visit pressroom.ups.com/RSS.




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Just the first paragraph by itself means that they are not going to go thru with it.

 

What are the odds this is a scare tactic to squeeze you guys more?

I hope that is what is going on, I'm pulling for you guys.

Best of luck.

 

Hope your right brownie. Hardly comforting to someone getting a letter soon. Well see what the Union has to say.

 

Wanna bet. 170 will get a notice this week and at least 100 will hit the street in May.

 

By HARRY R. WEBER AP Business Writer

ATLANTA February 8, 2010 (AP) The Associated Press


Shipping giant UPS is again telling its pilots they need to agree to more cost savings or the company will have to furlough at least 300 of them.

UPS made the same ultimatum to its roughly 2,800 pilots last year, but agreed to delay furloughs for at least 10 months after pilots agreed to more than two-thirds of the cost cuts the company wanted.

The two sides previously identified savings totaling roughly $90 million over three years. UPS wanted $131 million.

The earlier promise not to furlough pilots ends April 1. UPS said Monday the first group of pilots will be furloughed in May if another cost-cutting deal isn't reached.

Generally, pilots who are furloughed can be recalled to duty under certain circumstances.

 

Heard the letters ARE going out today. Does not mean they will be furloughed in May, but the letters will be sent today.

 

Very sorry to hear this. They keep holding the "F" word over our heads at Purple also (thus the illegal use of paragraph 4.a.2.b of our contract that "permits" management to pay us less than minimum guarantee).

If there is ANY good news it's that UPS is a GREAT COMPANY that will one day need more pilots and the furloughed folks will have a good job to go back to (I'm not so sure that's the case for many of our pax brethren).

 

I assume all my MOU contributions are cancelled, and the open time ban is in effect.

 

Squeeze play and EB test. Letters went out last time. Then canx'd. UPS hopes this divides the IPA, it goes opposite. They are using the $13 million MOU shorfall to see what they can get in exchange (maybe the FedEx deal??). I'll also bet a pretty strong IPA going into contract talks.