More UpClose RLA Video Lies from FedEx

bbsam

Moderator
Staff member
How do you know? You don't. Smith isn't acting like someone who has it in the bag, especially since he so obviously cooked the SFA numbers this year and is pulling every puppet string he can to get his way. God, I hope he loses, just so we can rub his face in it at every possible opportunity. And if the old man doesn't win, expect a temper tantrum like you've never seen before.
Of course I don't know. It's like any prediction; it means nothing. Like picking the Cubs to win the world series. Furthermore, I don't really care whether he wins or not because I think that either way I'm going to be just fine. In fact, in a completely selfish way I hope he does lose because I think I'll profit even more and faster in that scenario. But you yourself have ranted on about Smith buying politicians and favors so if he acts like it's in the bag it seems quite possible that it truly is.
 

MrFedEx

Engorged Member
Of course I don't know. It's like any prediction; it means nothing. Like picking the Cubs to win the world series. Furthermore, I don't really care whether he wins or not because I think that either way I'm going to be just fine. In fact, in a completely selfish way I hope he does lose because I think I'll profit even more and faster in that scenario. But you yourself have ranted on about Smith buying politicians and favors so if he acts like it's in the bag it seems quite possible that it truly is.

For awhile I was feeling pretty down about the chances of Fred losing. But lately, the company has really seemed desperate, especially when they posted SFA numbers that were obviously false and inflated. That gives me hope. It looks like Fred's pulling everything he has out of his bag of dirty tricks.

Just like Ricochet1, I'll probably be gone from FedEx before a union ever gets certified anyway. I just want to be there long enough to watch Smith twist and squirm trying to weasel his way out of negotiating a contract. He's an evil SOB, and deserves some of the crap he's been unloading on us. Time to turn the tables.
 

vantexan

Well-Known Member
For awhile I was feeling pretty down about the chances of Fred losing. But lately, the company has really seemed desperate, especially when they posted SFA numbers that were obviously false and inflated. That gives me hope. It looks like Fred's pulling everything he has out of his bag of dirty tricks.

Just like Ricochet1, I'll probably be gone from FedEx before a union ever gets certified anyway. I just want to be there long enough to watch Smith twist and squirm trying to weasel his way out of negotiating a contract. He's an evil SOB, and deserves some of the crap he's been unloading on us. Time to turn the tables.

That's assuming it'll ever get to negotiating a contract before he restructures the company. If he does, employees looking at 30-32 hrs a week will have no choice to vote for a union to get better pay. And that is if we still have permanent employees left who can unionize.

I'm hoping just the ability to vote for a union will get us better pay, and then business as usual. On what are you basing your assertion that getting a union will give us much higher pay and much better benefits? Not being critical, just asking. FedEx doesn't conduct it's business the same way UPS does. It has higher costs per package and less profit. Isn't it the profit, the money that's left over, that will pay the comparable to UPS pay and benefits you desire? Is there enough to do that? I think they can top us out faster, but can they afford to bump me up from $17.09hr to $30hr plus great benefits? And 10's of thousands of others?

These are questions that matter. Is FedEx able to do this? Could it possibly be that some would like to get a union in to hurt FedEx, if not bankrupt them, for revenge for what's been done? Don't get me wrong, I think they are greedy, don't really give a damn about us as long as they get their high stock price. But what good does it do us to ruin them? We have an administration that isn't business friendly. I don't see alot of opportunities if FedEx goes down in flames. Which they won't, they'll go contractor most likely, and once again Express employees will get screwed. The only good I can see in getting the NLRA designation is the possibilty that FedEx will give us better pay in a bid to keep the union out. If you can show me a better scenario than that which might actually happen I'd love to hear it. Or we can just ignor the 500lb gorilla in the room(the Ground scenario) and keep shouting for a union.
 

Ricochet1a

Well-Known Member
It has higher costs per package and less profit. Isn't it the profit, the money that's left over, that will pay the comparable to UPS pay and benefits you desire? Is there enough to do that? I think they can top us out faster, but can they afford to bump me up from $17.09hr to $30hr plus great benefits? And 10's of thousands of others?

If FedEx is ever forced to sign a collective bargaining agreement with the wage employees, its profit margin will only be slightly impacted. UPS has a union and healthy profits.

What would happen is that FedEx would have to restructure some things that it doesn’t want to restructure. By my calculations, it would have to raise Express rates by 2%, dump 2,500 salaried support staff that are part of the bloat in Memphis and extend the life cycle of equipment and technology past what it currently does. By doing this, Express would easily create enough funds to pay for $1 Billion USD increase in wages and benefits for approximately 50,000 wage employees which are being under compensated right now – amounts to $20,000/year increase in compensation per FT equivalent wage employee in the Courier, RTD, CSA, Ramp Agent and Mechanic classifications. Its profits wouldn’t suffer, unless there was a mass exodus of customers over a 2% rate increase…

In the past, FedEx stated that it competed on the basis of service provided and not price charged; we all know this has changed. In order to compete on a price basis and not cut service, there is only one option for FedEx to take, pull that “missing” revenue out of wage employees’ compensation. Ground has been ruthlessly structured to compete solely on the basis of price AND to grab as much market share as possible from UPS in the process. When Ground drivers do the exact same work as UPS drivers, yet receive only about 35% of the compensation as the UPS drivers, one can easily see where Ground is making its profits while charging less for shipping.

By my rough calculation, each Ground driver places their hands on roughly 50,000 pieces a year. Increasing rates on each of those pieces by just 50 cents – and funneling that revenue directly towards compensating the drivers – would increase their compensation by $25,000/yr. By increasing the rates on each piece that Ground handles by $1 – funneling that revenue directly towards compensating the drivers – would increase their compensation by $50,000/yr; placing them on par with UPS drivers. If FedEx were to do this though, it couldn’t compete on the basis of price with UPS and continue to gain market share.

PSP has been tossed out the window, since FedEx believes that it can compete on the basis of price, maintain service levels and gain market share from UPS, while “recovering” the revenue not collected from keeping stagnant wages for its wage employees. Everything I’m hearing out of Memphis suggests that Fred made one screw up though – he gutted the pension plan not only for wage employees, but for everyone that isn’t in upper management or covered by a contract (the pilots).

The salaried employees in Memphis cannot organize, but when the economy improves, they’ll start leaving. Anyone under the age of 35 and has any sort of education in finance realizes that the PPP is a joke and not worthy of even being called a pension plan. Everyone older than this realizes the same but they also realize their options for finding a new career are difficult at best. Everyone realizes that FedEx is transforming from the growth company it was in the 80’s and early 90’s to a mature company that can no longer count on growth to keep the revenue stream increasing.

With FedEx having achieved the status of a “mature” corporation while still wanting to continue to grow, its sources for increasing revenue and therefore profit margins can only come from two places: deliberately keeping wages stagnant and fighting for an increase in market share from UPS. FedEx is doing both. This means the wage employees are left with but two options: accept the stagnant wages or fight to organize and maintain their compensation parity with UPS and force Fred to take a different route to maintain FedEx profitability. It would mean that FedEx would have to drop some of the salaried staff in Memphis and would have to increase rates slightly to fund the compensation increase for its wage employees. In other words, bring back PSP and compete on the basis of service and not trying to beat someone else’s rates by a few percentage points.
 

vantexan

Well-Known Member
If FedEx is ever forced to sign a collective bargaining agreement with the wage employees, its profit margin will only be slightly impacted. UPS has a union and healthy profits.

What would happen is that FedEx would have to restructure some things that it doesn’t want to restructure. By my calculations, it would have to raise Express rates by 2%, dump 2,500 salaried support staff that are part of the bloat in Memphis and extend the life cycle of equipment and technology past what it currently does. By doing this, Express would easily create enough funds to pay for $1 Billion USD increase in wages and benefits for approximately 50,000 wage employees which are being under compensated right now – amounts to $20,000/year increase in compensation per FT equivalent wage employee in the Courier, RTD, CSA, Ramp Agent and Mechanic classifications. Its profits wouldn’t suffer, unless there was a mass exodus of customers over a 2% rate increase…

In the past, FedEx stated that it competed on the basis of service provided and not price charged; we all know this has changed. In order to compete on a price basis and not cut service, there is only one option for FedEx to take, pull that “missing” revenue out of wage employees’ compensation. Ground has been ruthlessly structured to compete solely on the basis of price AND to grab as much market share as possible from UPS in the process. When Ground drivers do the exact same work as UPS drivers, yet receive only about 35% of the compensation as the UPS drivers, one can easily see where Ground is making its profits while charging less for shipping.

By my rough calculation, each Ground driver places their hands on roughly 50,000 pieces a year. Increasing rates on each of those pieces by just 50 cents – and funneling that revenue directly towards compensating the drivers – would increase their compensation by $25,000/yr. By increasing the rates on each piece that Ground handles by $1 – funneling that revenue directly towards compensating the drivers – would increase their compensation by $50,000/yr; placing them on par with UPS drivers. If FedEx were to do this though, it couldn’t compete on the basis of price with UPS and continue to gain market share.

PSP has been tossed out the window, since FedEx believes that it can compete on the basis of price, maintain service levels and gain market share from UPS, while “recovering” the revenue not collected from keeping stagnant wages for its wage employees. Everything I’m hearing out of Memphis suggests that Fred made one screw up though – he gutted the pension plan not only for wage employees, but for everyone that isn’t in upper management or covered by a contract (the pilots).

The salaried employees in Memphis cannot organize, but when the economy improves, they’ll start leaving. Anyone under the age of 35 and has any sort of education in finance realizes that the PPP is a joke and not worthy of even being called a pension plan. Everyone older than this realizes the same but they also realize their options for finding a new career are difficult at best. Everyone realizes that FedEx is transforming from the growth company it was in the 80’s and early 90’s to a mature company that can no longer count on growth to keep the revenue stream increasing.

With FedEx having achieved the status of a “mature” corporation while still wanting to continue to grow, its sources for increasing revenue and therefore profit margins can only come from two places: deliberately keeping wages stagnant and fighting for an increase in market share from UPS. FedEx is doing both. This means the wage employees are left with but two options: accept the stagnant wages or fight to organize and maintain their compensation parity with UPS and force Fred to take a different route to maintain FedEx profitability. It would mean that FedEx would have to drop some of the salaried staff in Memphis and would have to increase rates slightly to fund the compensation increase for its wage employees. In other words, bring back PSP and compete on the basis of service and not trying to beat someone else’s rates by a few percentage points.

OK, but to reorganize to the point it can compensate 50,000 employees at a level close to UPS may require a lot more pain than trimming 2500 jobs in Memphis. If doing so would bring FedEx that much extra cash I bet they'd have already done it, at least through attrition, to claim that money as profit. To do what you are saying may have to go beyond Memphis. They may have to reduce number of managers, require mgrs to handle more employees. Give mgrs a little more pay for doing so but eliminate bonuses and other perks. And if employees do unionize, any group that can't, i.e. Ground drivers, probably won't see pay increases any time soon. As that's their cash cow I don't see them doing anything to mess that up.

In other words they can turn the company upside down and inside out to pay the union wages and maintain profits, or they can restructure the business to minimize union impact, transferring some if not all freight to Ground, tell Express employees to stick it. Based on the last 20 or so years, what would seem most likely?
 

Ricochet1a

Well-Known Member
You need to get ahold of the financial statements for FedEx Corporation and do some research on your own. By raising rates 2% across the board in Express, cutting targeted salaried positions and extending the lifecycle of equipment and being more careful in the purchase of technology (all those labeling guns for ROADS are going to be replaced after only a year...) enough cash can be set aside to fund an increase in compensation levels for wage employees. It won't bring Express up to UPS levels by any stretch - there would still be about a 10-15% gap between Express and UPS AFTERWARDS...

FedEx has already maintained a barebones approach to its field management staffing levels. There is nothing left there to be cut. FedEx last year already did a culling out of excess management staff - I haven't been able to get ahold of accurate numbers of how many were given walking papers and severance packages but the cuts numbered at least a couple of hundred if not more. Do some research as to the salaries that field management receives and then divide that by the hours per year they put in - many are getting paid less than topped out Couriers calculated on an hourly basis. Not defending them, but they realize that they got the short end of the stick too. It is the staff in Memphis and the regional HQs that is still bloated and overcompensated.

All of this is what a collective bargaining team would look at BEFORE entering negotiations with Express. You are falling into the trap of assuming that the current business model of Express is the only option available to Express. There are other methods available for operating a company, UPS does it quite well.

What collective bargaining does is allow employees to have their wages determined NOT by the scarcity of labor availability to set equilibrum wage rates, but rather to act COLLECTIVELY to have wages determined on the basis of value added to the employer for that labor being performed. There is a significant gap in those two methods of determining what a wage should be, unions exist to get their members' wages set on the basis of value added, not labor scarcity.
 

vantexan

Well-Known Member
You need to get ahold of the financial statements for FedEx Corporation and do some research on your own. By raising rates 2% across the board in Express, cutting targeted salaried positions and extending the lifecycle of equipment and being more careful in the purchase of technology (all those labeling guns for ROADS are going to be replaced after only a year...) enough cash can be set aside to fund an increase in compensation levels for wage employees. It won't bring Express up to UPS levels by any stretch - there would still be about a 10-15% gap between Express and UPS AFTERWARDS...

FedEx has already maintained a barebones approach to its field management staffing levels. There is nothing left there to be cut. FedEx last year already did a culling out of excess management staff - I haven't been able to get ahold of accurate numbers of how many were given walking papers and severance packages but the cuts numbered at least a couple of hundred if not more. Do some research as to the salaries that field management receives and then divide that by the hours per year they put in - many are getting paid less than topped out Couriers calculated on an hourly basis. Not defending them, but they realize that they got the short end of the stick too. It is the staff in Memphis and the regional HQs that is still bloated and overcompensated.

All of this is what a collective bargaining team would look at BEFORE entering negotiations with Express. You are falling into the trap of assuming that the current business model of Express is the only option available to Express. There are other methods available for operating a company, UPS does it quite well.

What collective bargaining does is allow employees to have their wages determined NOT by the scarcity of labor availability to set equilibrum wage rates, but rather to act COLLECTIVELY to have wages determined on the basis of value added to the employer for that labor being performed. There is a significant gap in those two methods of determining what a wage should be, unions exist to get their members' wages set on the basis of value added, not labor scarcity.

OK, but didn't FedEx raise rates already this year? As to mgmt, in areas that were hard hit by the economy they found there were too many mgrs for the employees they had. Excess mgrs were given the option to transfer to stations in need of a mgr or to leave the company. Our station received one of those mgrs, but recently got approval for a 3rd mgr also, who has since transferred in. We aren't going the barebones approach.

Apparently they have heard about bloated regional HQ's. Our district has been absorbed into 2 others and our district office has shut down. They've been in the process of consolidating operations into fewer stations nationwide for some time now. Getting ready to meet the challenge of paying union wages? Or getting ready to trim Express to the bone? We may get the union in, may get the higher pay, may even get better benefits. But those counting on $60k to $70k jobs plus UPS comparable benefits are probably going to be disappointed.

If we get $30 hr but only 25-30 hrs a week, what then? Do we strike? I know what I'd do. I'll finally have some leeway to work a 2nd job without worrying about DOT regs. So I'll make close to $60k between the two. Knowing FedEx, that's the only way I'll ever make that kind of money.
 

MrFedEx

Engorged Member
OK, but didn't FedEx raise rates already this year? As to mgmt, in areas that were hard hit by the economy they found there were too many mgrs for the employees they had. Excess mgrs were given the option to transfer to stations in need of a mgr or to leave the company. Our station received one of those mgrs, but recently got approval for a 3rd mgr also, who has since transferred in. We aren't going the barebones approach.

Apparently they have heard about bloated regional HQ's. Our district has been absorbed into 2 others and our district office has shut down. They've been in the process of consolidating operations into fewer stations nationwide for some time now. Getting ready to meet the challenge of paying union wages? Or getting ready to trim Express to the bone? We may get the union in, may get the higher pay, may even get better benefits. But those counting on $60k to $70k jobs plus UPS comparable benefits are probably going to be disappointed.

If we get $30 hr but only 25-30 hrs a week, what then? Do we strike? I know what I'd do. I'll finally have some leeway to work a 2nd job without worrying about DOT regs. So I'll make close to $60k between the two. Knowing FedEx, that's the only way I'll ever make that kind of money.

Here's my bottom line. Fred S is a known quantity. Unless we have some type of leverage against him we'll be underpaid and treated like dirt forever. If we do go union, expect a fight...threats, lockouts, etc. But what if we don't go union, what can we expect then? IMO it will just be more of the same, with the added possibility that Ground is given a big chunk of our business so Smith can pocket even more profit by exploiting the hell out of them. So, what do we do?

Again, IMO, we have to go union and fight the fight. Smith may not be willing to endanger the Express business with labor disruptions, so he might put a better offer on the table in the hope that we choose not to certify. But consider who and what Smith is...he cannot be trusted under any circumstances. That's why we need a contract, and not some phony deal that Smith can renege-on or renegotiate at his whim. The pilots learned this lesson the hard way with their original in-house union, which quickly went away and was replaced by ALPA when Fred kept up his games.

FedEx can afford to pay much higher wages. Did you know, for example, that FedEx has options on 190 more 757's that will be converted from PAX to Cargo for millions per plane? There's more technology in the pipeline too. Fred always has money to "build for the future" or invest in some high-tech solution that makes us more productive or cuts staff jobs, but can never seem to find any funds to invest in frontline employees. This cycle will be perpetual unless we put a stop to it now. Hell, he's probably already plotting to replace most of us with Ground people. What do we really have to lose? NOTHING. Fred is way overdue for having a kink put in his pipe and we need to realize it and do something besides talk about it.
 

vantexan

Well-Known Member
Here's my bottom line. Fred S is a known quantity. Unless we have some type of leverage against him we'll be underpaid and treated like dirt forever. If we do go union, expect a fight...threats, lockouts, etc. But what if we don't go union, what can we expect then? IMO it will just be more of the same, with the added possibility that Ground is given a big chunk of our business so Smith can pocket even more profit by exploiting the hell out of them. So, what do we do?

Again, IMO, we have to go union and fight the fight. Smith may not be willing to endanger the Express business with labor disruptions, so he might put a better offer on the table in the hope that we choose not to certify. But consider who and what Smith is...he cannot be trusted under any circumstances. That's why we need a contract, and not some phony deal that Smith can renege-on or renegotiate at his whim. The pilots learned this lesson the hard way with their original in-house union, which quickly went away and was replaced by ALPA when Fred kept up his games.

FedEx can afford to pay much higher wages. Did you know, for example, that FedEx has options on 190 more 757's that will be converted from PAX to Cargo for millions per plane? There's more technology in the pipeline too. Fred always has money to "build for the future" or invest in some high-tech solution that makes us more productive or cuts staff jobs, but can never seem to find any funds to invest in frontline employees. This cycle will be perpetual unless we put a stop to it now. Hell, he's probably already plotting to replace most of us with Ground people. What do we really have to lose? NOTHING. Fred is way overdue for having a kink put in his pipe and we need to realize it and do something besides talk about it.

You are probably right, going to be messy no matter what. I just wish we could get on with it, tired of waiting for Congress to get it passed. Sad thing is that FedEx is in the position right now to take the lead and offer us something better. Might even be in their best interest to do so, might persuade Congress to leave language out. But they are obviously waiting to see how legislation works out, which says to me they'll only do something positive if forced to, otherwise they have no intention of significantly improving our pay. Hope they prove me wrong.
 

MrFedEx

Engorged Member
You are probably right, going to be messy no matter what. I just wish we could get on with it, tired of waiting for Congress to get it passed. Sad thing is that FedEx is in the position right now to take the lead and offer us something better. Might even be in their best interest to do so, might persuade Congress to leave language out. But they are obviously waiting to see how legislation works out, which says to me they'll only do something positive if forced to, otherwise they have no intention of significantly improving our pay. Hope they prove me wrong.

Yep. They would much prefer to maintain the status quo, which speaks volumes about their overall attitude that we are Walmart on wheels. Fred could have done the right thing many times, and at every opportunity, pins-us to the mat for another beating. I don't think Congress cares about us either because we're just pawns in the larger battle between UPS and FedEx. If Smith loses, I'm thinking a token offer of better things that is so full of loopholes and other exits that it's not worthwhile. It's all about paying us the absolute minimum they can get away with along with keeping all of the oppressive personnel policies that allows FedEx to basically do whatever they want whenever they want to do it. We absolutely need a union.
 
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