The Teamsters union has finally broken through with XPO Logistics (NYSE: XPO), reaching a contract agreement for the company’s Miami facility last week with rapid unanimous approval then being granted by the rank and file over the weekend.
The contract between XPO and the Teamsters is historic in that it is the first that the union has been able to reach with XPO anywhere in the U.S. (XPO is partially unionized in Europe and says it has 212 unionized employees in the U.S. and Canada.) There are several other XPO facilities where workers have voted to be represented by the Teamsters but where no contract has been reached.
XPO’s Miami facility traces back to Conway Freight, the LTL carrier that XPO acquired in September 2015. Workers in Miami actually had voted to be represented by the Teamsters a year earlier, when it was still a Conway facility.
In a prepared statement, the Teamsters quoted Jim Hoffa, the union president, as saying that “XPO management said workers in the U.S. would never ratify a contract, but never is now.”
The response from XPO about the contract was succinct: “The Teamsters offered us a contract that was too attractive to turn down.”
Sources familiar with the contract said XPO believes there are several provisions in it under which unionized XPO workers are worse off than nonunionized workers at the facility, including pay that won’t catch up to that of the nonunion workforce until the start of 2022. The sources also said the average 0.9% raise negotiated in the contract is less than what nonunionized workers can expect to receive based on recent history.
There also is no limit on the use of subcontractors, the sources said.
In an interview with FreightWaves, Greg Chockley, the national campaign coordinator for the Teamsters, said the two-year contract is retroactive to June 1. While there are pay considerations, Chockley mostly wanted to discuss the procedures and rules that come with the contract.
“They are looking to have their working ways put into writing and hold the employer accountable in ways that they don’t have as unorganized workers,” Chockley said.
He ticked off a list of provisions in the contract: protection of retirement benefits, protection of processes, requiring just cause for termination or discipline. Chockley added that there also is a provision for binding arbitration for disputes, with the judging in the process to be done by an independent arbitrator. Previously, Chockley said, XPO was “judge, jury and executioner.”
Josh Zivalich, the president of Teamsters local 769 in Miami, which will represent the workers at XPO, said another provision sought by the union that is in the contract is a seniority system that will govern layoffs and callbacks.
Chockley said the average worker will see a pay increase of $1.50 per hour over the life of the contract. The average pay will be more than $30 per hour. A Teamsters spokesman said wage increases over the prior five years, during negotiations between the union and the company, averaged $8 per hour.
Approximately 70 workers are covered by the contract.
The relationship between the Teamsters and XPO has been one of the longer-running and more contentious in both the logistics industry and the labor movement. Earlier this year, workers who had voted to be represented by the Teamsters reversed course at two XPO facilities after failing to reach a contract agreement at either site. (A third facility also reportedly had the same reversal).
Meanwhile, Teamsters pressure did help lead to the pay package for XPO’s CEO being rejected by shareholders earlier this year. Sources close to the Teamsters also said that XPO employees had rejected four election petitions last year.