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FedEx pilots to vote on strike authority, but no action imminent

Federal mediators continue to oversee collective bargaining between union and company

FedEx is accelerating the retirement of older MD-11 aircraft (pictured) in favor of more fuel-efficient aircraft. (Photo: Shutterstock/Bradley Caslin)

Union leaders representing Federal Express pilots said late Friday they will seek authority from members to call a strike when legally permissible. But no imminent work action can happen because the federally controlled negotiating process still has a long way to go.

The Air Line Pilots Association said voting for strike authorization will begin Tuesday. Getting rank-and-file permission to call a strike is a common union tactic that typically gives its bargainers more clout at the negotiating table. The pilots are frustrated by what they perceive as slow progress over two years.

The FedEx (NYSE: FDX) pilots’ contract became eligible for changes in November 2021, although talks began six months earlier. Management and the union have been bargaining through the auspices of the National Mediation Board for the past seven months after direct negotiations failed to produce an agreement. Officials say they have resolved retirement and quality-of-life issues but are still at odds over pay levels.

“At a time when our pilots should be joining our company in celebration of its 50th anniversary, we are instead forced to apply additional pressure to management in an effort to secure a new contract,” said Capt. Chris Norman, chair of the FedEx Master Executive Council. 

“We do not make a decision like this lightly, but we intend to send a strong and unified message to management that our pilots are willing to go the distance to achieve the contract we have earned.”

Under federal rules designed to prevent work interruptions in critical interstate commerce, workers are prohibited from striking and companies from locking out workers until a lengthy series of bargaining steps, including federal mediation, are completed.

The federal mediator has the power to hold the parties in mediation indefinitely. The negotiation process can take more than a year at this stage.

If no progress is made, the National Mediation Board (NMB) at some point may release the union to a 30-day cooling-off period during which negotiations can still take place but no strike or lockout can occur.

If the NMB determines the parties have reached an impasse it can propose that the remaining issues be sent to a special panel for binding arbitration. Arbitration in the airline industry is rare because both sides must agree to it. 

The law allows the president to create an emergency board to investigate a labor dispute and issue a report within 30 days if the parties reject binding arbitration. That is followed by another 30-day period to consider the board’s recommendations and reach an agreement. If no agreement is reached at the end of the cooling-off period, the parties may take action, such as a strike or lockout. 

“FedEx remains focused on reaching a comprehensive agreement. With that in mind, we remain committed to bargaining in good faith with our pilots to achieve an agreement that is fair to them, our other team members, and all other FedEx stakeholders,” the company said in a statement. “ALPA’s call for a vote of its members has no impact on our service as we continue delivering for our customers around the world.”  

Several factors are influencing each party’s bargaining position and relative power.

Amid the COVID crisis and supply chain disruptions two years ago, e-commerce and air cargo were in extremely high demand and all-cargo operators enjoyed unrivaled profits. But e-commerce and international growth cooled off significantly last year. 

The softness in volume combined with an underutilized infrastructure network contributed to significant declines in operating income in the fiscal year first quarter and stirred management to implement a $6 billion cost-cutting and restructuring campaign. That includes parking aircraft, flying fewer flights and outsourcing more airlift to third parties.

The restructuring is impacting pilots with closure of pilot bases, forced downgrades that equate to a pay reduction and potential job cuts if the airline shrinks, ALPA said.

And there is always the prospect of federal intervention that could prevent the union from getting everything it seeks through collective bargaining. In December, President Joe Biden signed legislation requiring all freight rail unions to ratify the labor agreement that union and railroad negotiators had reached in September. 

UPS pilots last year ratified a two-year contract extension

Click here for more FreightWaves and American Shipper articles by Eric Kulisch.

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Eric Kulisch

Eric is the Supply Chain and Air Cargo Editor at FreightWaves. An award-winning business journalist with extensive experience covering the logistics sector, Eric spent nearly two years as the Washington, D.C., correspondent for Automotive News, where he focused on regulatory and policy issues surrounding autonomous vehicles, mobility, fuel economy and safety. He has won two regional Gold Medals and a Silver Medal from the American Society of Business Publication Editors for government and trade coverage, and news analysis. He was voted best for feature writing and commentary in the Trade/Newsletter category by the D.C. Chapter of the Society of Professional Journalists. In December 2022, he was voted runner up for Air Cargo Journalist by the Seahorse Freight Association. As associate editor at American Shipper Magazine for more than a decade, he wrote about trade, freight transportation and supply chains. Eric is based in Portland, Oregon. He can be reached for comments and tips at [email protected]