FedEx Pilots Picket Over Prolonged Contract Stalemate

Yahoo

2 days ago

Roughly 300 FedEx pilots picketed the company's executive offices Tuesday in a show of displeasure with ongoing contract negotiations that have lasted more than four years.
The Air Line Pilots Association, International (ALPA), which represents more than 5,500 pilots at FedEx, met with company officials under federally mediated bargaining sessions as recently as last week. But neither side came to a deal.
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'FedEx has had four years to do the right thing, but instead it has chosen to invest in shareholders over its employees,' said Capt. Jose Nieves, chair of the FedEx ALPA master executive council, said in a statement. 'The pilots are done waiting. We've delivered through crisis and transformation, and we expect to be treated like professionals who enable corporate success.'
Pilots began bargaining for a new contract in May 2021, attempting to modernize what the union called an 'outdated' labor agreement signed back in 2015. The parties initially achieved a tentative agreement in May 2023, but the pilots rejected the deal two months later.
At the time, FedEx was offering a 30-percent increase for both pilot pay and legacy pensions. But the union said that was lower than a 40-percent hike the ALPA-represented United Airlines pilots received in a contract earlier that month.
Since the rejection, both sides have made very little headway toward striking a deal, with negotiations having been on and off.
'We remain committed to reaching an agreement through the mediation process that is fair to our pilots, our other team members, and all FedEx stakeholders,' a FedEx spokesperson said. 'Informational picketing is a common occurrence during negotiations and does not impact our service.'
A line of pilots standing outside the Memphis, Tenn. offices held up signs that read 'We're FedUp,' 'Stop profits over people,' and 'Stop outsourcing American jobs' as part of the picketing.
The union's grievances target the company's ongoing Drive transformation, which is designed to cut costs at the logistics giant by $4 billion by the end of 2025, and another $2 billion through 2027.
The transformation encompasses the Network 2.0 strategy, which is designed to consolidate the FedEx delivery network with fewer stations and routes and increase shipping efficiency, and the 'Tricolor' redesign of its air operations. The Tricolor strategy broke out FedEx's flights into three separate colors— purple, orange and white—based on customer demands, delivery timeliness and product category.
ALPA's members feel the current contract for the FedEx pilots does not reflect some of these operational shifts.
For example, with the company's partnership with the U.S. Postal Service (USPS) expiring last September, FedEx is expected to reduce its daytime flight hours by approximately 60 percent. Before the partnership ended, FedEx identified that it had a surplus of 500 pilots.
'The corporation has yet to bring forward basic insights into how it plans to employ the pilot group in the future, a major challenge to scope bargaining efforts,' the statement read, with the company saying the current agreement 'is based on a decades-old operation that FedEx is clearly signaling looks nothing like its future plans under a One FedEx, Tricolor, Network 2.0 operations strategy.'
The 79,000-pilot union also has expressed gripes with FedEx after it replaced European 757 pilot flights with third-party contract carriers, taking the ALPA pilots out of rotation. FedEx had previously maintained a pilot base in Cologne, Germany, to complement its European hub at Charles de Gaulle Airport in Paris, before closing it in 2024.
Although ALPA claims FedEx said the Cologne routes would shift to Memphis-based pilots, the union says company management steadily slashed the mainline European flights, with flights after April all being transitioned to third parties.
'The reality is clear—European FedEx 757 pilot flights have been completely replaced by third-party contract carriers,' said Nieves in a March statement.
Nieves indicated FedEx executive chairman Fred Smith 'signaled growth in the Far East market,' suggesting that a similar scenario could happen to the Oakland, Calif.-based pilots who operate FedEx's Far East flights.
'One can only wonder whether those will be FedEx pilots flying under our established routes or if they will be outsourced as well,' said Nieves.
FedEx has made more of a concerted push to leverage third parties to capture more of what chief customer officer Brie Carere has identified as an $80 billion air freight market, while keeping costs down. During a December earnings call, she said FedEx had a 'low-single-digit market share' in the market.