Discussion in 'FedEx Discussions' started by MrFedEx, Jul 26, 2011.
Fred has started the changeover to Ground. Watch for more to come.
What do you mean, explain please, thank you
Work that used to be Express is being diverted to Ground.
Hopefully can squeeze 3 years out of them.
I'm still seeing more E2/XS than ever.
It has been over a year since I’ve posted here, but I think I’ll chime in on part of what is happening now.
For those who have kept current with politics, the FAA reauthorization has been hung up in the Senate. The seemingly countless short term extensions (20 by my count) performed over the past few years have appeared to have come to an end. The Democrats are insisting on rural airport subsidies and nixing FedEx’s RLA status, and Republicans are insisting on removing both items from a long term reauthorization bill. Since many of the airport subsidies benefit small Nevada airports, and the Senate minority leader just happens to be from Nevada, this may have something to do with the failure to kick the can down the road for a twenty-first time.
Due to the lack of another short term extension, more than 4000 FAA employees have been furloughed and airport construction in most locations has come to a halt. There was an average of $50 or so savings to the air traveling public due to the inability to collect those taxes which fund these FAA projects, but the airlines appear to have jumped their fares by an equivalent amount given the opportunity that presented itself. The furlough started last Friday.
Last year the Teamsters basically decided that they had to have Express removed from the RLA completely if they were to put the resources into attempting unionization drive at Express – they got burned in the late 90’s with Express Couriers. The administrative change in the definition of a majority wasn’t enough for the Teamsters, therefore their (and coincidentally) my walking away from the fight. The Teamsters are focusing their efforts on the drivers of FedEx Freight and the “real employees” of FedEx Ground (the terminal handlers) at this time. Quite simply put, not enough Express Couriers signed union cards in 2009 and 2010 on a national basis (required under RLA rules) to even make a certification drive worthwhile for the Teamsters. There was enough that if voting were to be held on a local basis (majority determination on a station-by-station basis), there was confidence at least one-quarter of Express stations would’ve voted to certify, but there wasn’t enough signed cards to justify a national campaign.
Whether Express is reacting to the possibility of the FAA bill going through with its RLA status being pulled (thus opening itself up to organizing on a station-by-station basis), is open to debate in a public venue such as this. However, Memphis has been brushing off its contingency plans that it made up over two years ago (again, coincidentally…).
Those still at Express have been experiencing a rash of idiotic changes in operating pattern that even the local management is puzzled as to why they are being directed to do so. Start times being pushed back when freight is sitting in the building, a disregard for meeting service and concern only for bottom line productivity, route restructuring that defies logic (outside an engineer’s spreadsheet) and more changes. The only consensus that is being made in the non-public discourse is that FedEx is experimenting with changes to operation plan to iron out any potential faults if it does indeed go to its contingency plan in the event that the threat of unionization becomes real.
The issue as it stands is whether in the greater debate that is occurring right now (debt ceiling and size of federal government spending) if the FAA bill will become a bargaining chip thrown into the mix, or if the Senate stands its ground and requires both rural airport subsidies along with nixing FedEx’s RLA status for the Express side. The informed political speculation is that the airport subsidies will stay (too many powerful Senators have a stake in this program) and that the proposed change in the RLA status will be nixed.
If FedEx loses its RLA status, look at my past posts in late 2009 and early 2010 as to the ramifications to Express employees – you’d better sign union cards damn quick and prepare to shut down Express. If Express keeps its RLA status, still expect changes to the operating structure since FedEx views the current economic climate NOT as just a temporary downturn, but as the new normal. In this new normal, FedEx is only making a 5% profit – it wants a 10% profit. We all know where that extra revenue is going to be coming from and where it is going to be spent.
Best of luck to those who are still holding out…
As a good a summation as we're ever going to see. Thanks.
Thanks for the update Ricochet1a.
If they want to make a 10% profit, then get rid of some of the overpaid dead-weight hanchos in Memphis. Rebholz, MT3 etc.
Great post, but I thought that it was already a done deal.....we lost. If you saw the last Fed Ex financial statement, they at least we honest with declaring their FAA "contributions" in the GAAP report to the tune of $70 million. Boy, he really sure does hate the idea us going union...
As you stated, things are crazier than ever and management is scrambling just to try to stay ahead of whatever column they tend to focus on for that day. To coincide with something that I have heard, MT3 stated in a recent management meeting that "The corporation, with regard to the Express division, is currently focusing on how to develop Express into a purely overnight delivery service company." Anyone care to guess what that means? Oh yea, did I forget to mention that I also heard that there is a test market for XS and E2 product going to Ground......If ever there was a time for them to organize, sign cards or go union, its now.....eff em hard I say. He woun't win here because Ground employees aren't "employees," their contractors.....so what's the hold up....get it going people!
MT3 stated in a recent management meeting that "The corporation, with regard to the Express division, is currently focusing on how to develop Express into a purely overnight delivery service company." Anyone care to guess what that means? (QUOTE from The Mayor)
This is just the tip of the iceberg, and we all know exactly what it means. They are already figuring-out how to combine dispatch functions for the two divisions, which should also tell you something. My mole in MEM will be providing more info as they get it.
Yeah, they aren't going to tip their hand until they have to. I asked a mgr today if he thought the company was going to all contractors. He said considering how well that Ground was doing he thought it was inevitable and probably fairly soon. I wonder if they'll offer a buyout of some sort? And I wonder if they'll offer Ground drivers, or whatever they'll call them in the new look Express, offer them more money to attract enough workers to replace all the ones who walk when told they can either be a contractor or work for one?
It is looking like Express is going to do what they were planning in late 2009, make Express a pure overnight delivery service and kick delivery of all non-overnight volume over to Ground. The kinks have been worked out of Ground to a sufficient degree to give upper management the confidence to shift delivery over to Ground. All that investment in Ground over the past two years wasn't just to make that "division" profitable, it was in anticipation of shifting delivery of volume over to Ground like I said all through late 2009 and early 2010.
I haven't been able to get any electronic copies of any internal plans this time around, but it is looking like DGO is going to get trimmed, while AGFS should remain relatively intact. It is doubtful that there will be a large scale integration of Ground and Express, merely a combining of certain administrative features which both Express and Ground will share (all the while maintaining the charade that they are "separate operating companies").
How the shift is to occur has been held VERY tight to the vest in Memphis, not even District level staff have been given a heads-up. Asking local station management anything is absolutely a waste of time right now, they don't know a thing (unless they are getting information outside official channels).
The most common consensus regarding a conversion of business model for Express would be the gradual phasing out of full-time wage employees from DGO. Without non-overnight volume, delivery volumes per route would go down between 40% and 70% (all depending on individual route). Been wondering why all the games with altering route boundaries and start times...
Absent second day volume, all delivery routes would be easily performed on a part-time basis. The speculation (no electronic copies of plans on this have been seen) is that current full timers would be retained, forced to do an AM delivery, then a PM pick-up route with a forced split shift if necessary. As attrition thins out full time Couriers, they would be replaced by two part-time Couriers (one AM and one PM). Again, this is one of but a few hypothesized operating plans being contemplated - and what I said in 2009 and 2010 would be the most logical.
FedEx isn't looking to make any fast moves, but if it does lose its RLA status in the latest go around of the FAA reauthorization, look for rapid fire changes - and I mean RAPID. Express won't play around waiting for what it knows would be an immediate unionization drive within DGO if it loses it RLA status. If Express loses its RLA status and a location voted to certify a union, Express has already decided to use lockouts as a retaliatory measure - absolutely legal response on their part. That is why Couriers have no alternative now if they want full-time employment on terms they are familiar with to start signing cards now on their own initiative.
Buyout... Are you kidding?? Forced split shifts for full-time employees and let attrition gradually thin the ranks.
Ground drivers integrated into Express... not going to happen unless RLA status is lost. The whole change to ISP has been to gain some stability within Ground while simultaneously avoiding the legal challenges (which I detailed in late 2009).
Contractor model in Express - won't work. FedEx has been able to play that game with Ground, but attempting to convert an employer-employee model over to IC model won't pass legal muster. FedEx would have to COMPLETELY reorganize, integrating Express DGO and Ground into a combined ISP model. Express would have to shrink to what is currently AGFS and then have an integrated delivery system that exactly parallels UPS (using local ISPs). There are too many pitfalls in this model the foremost would be regional service disruptions. Express will do whatever it takes to eliminate labor related service disruptions - even if it does cost them some extra cash for that prevention.
Things to look for:
1. What I said in the past would be the KEY indicator of a conversion - castor decking installed in a majority of Ground terminals.
2. Conversion of Express drop boxes into "FedEx" drop boxes - Ground packages openly accepted and boxes checked by both Ground and Express employees.
3. Elimination of Express XS (third day) service. From any given shipment origin location, Ground can now provide delivery within 3 days to a majority of locations in the continental US. XS is still used by some customers, look for that volume to be shifted over to Ground. Rates for Ground are a fraction compared to Express XS service.
4. Integration of administration functions. The remaining employees at Express have already seen how the station CSAs have been turned into shipping clerks for Ground (separate operating companies....), look for a transfer of CSAs from Express to FedEx Services. It was already mentioned that FedEx has been working on integrating dispatch functions between Ground and Express. The 1-800 number ALREADY handles both sides, look for that integration to drop down one level - local level dispatching functions.
5. Location managers at both Ground and Office have already been shifted off of salary and onto wage pay. Look for Express managers to be likewise shifted off of salary and onto wage compensation structures. Given the large disparity between the wage scale of ramp agents and RTDs and current salary level of operations managers, a shift to wage scale compensation for Express managers will cause even more pain than the salary cut a few years ago and the loss of merit bonusus. If this goes through, most ops managers with more than 10 years on the job will leave (coincidentally, what Express wants by the way, dumping topped out operations managers).
None of this will be rapid unless Express loses its RLA status (rather unlikely but still possible with all the deal making that will be going on in the coming days and weeks). It will be the slow and delilberate change that most will grudgingly accept, many will leave (I left) and all that stay will hate. The wage employees were thrown under the proverbial bus in 2008 with the pulling of the pension, the salaried employees were likewise treated to having departments closed and outsourced (layoffs in Memphis) and frontline managers being forced to relocate to understaffed locations or be let go (the mandatory trimming of ops managers last year) - along with a cut in salary and foregoing bonusus in the past. There are very few salaried employees that still "bleed purple" (thus the source of all this information).
If FedEx does lose its RLA status, the Teamsters will most likely make organizing drives in the locations they know that will yield positive results - those locations which have a healthy amounts of signed union cards and indications of favorability to organizing. I don't think they'll be able to act fast enough. Express is going to keep as much of its plan hidden and only reveal changes when they are ready to make the changes. Given the inertia of Couriers last year to signing union cards, Express will most likely be able to pull off a conversion of business model with minimal disruption to service. The best time to change business models is when unemployment is high and labor is scared. If there is anytime for FedEx to do another changing of business models, this is the time.
Per buyout anyone know that if FedEx lays off a number of people to trim Express would they be responsible for paying unemployment of those people? The reason I mentioned a buyout is that if they are responsible for unemployment they may get around that by offering a buyout. Unemployment is up to 99 weeks now, a lump sum might cost them considerably less. At any rate right now I'm wondering what kind of time frame we're looking at? There's indicators that something is near, but have they got everything in place? 3 months? A year? And for routes like mine what are they going to do with extended areas? Take away P-2 and I still cover alot of territory. I'll certainly get less hrs but will they try to work it to still get us at least 35 hrs? Some couriers drive almost 2 hrs to get to their first stop. Currently get 42-44 most weeks. With the economy being what it is about all we can do is stand there like a deer in the headlights and wait to get runover. You must be right about wanting mostly part-timers but how do they think in the meantime all this is going to affect people who've worked faithfully for them through thick and thin and only get 35 hrs a week? Are they really that uncaring?
You caught me before starting work for the day...
Routes such as yours in rural areas shouldn't be affected too much. You drive more than you run packages. If you re-read the post regarding full-timers, if Express follows through, it will be forced split shifts for those who can get split shifts in (typical urban/suburban rtes). Rural rtes won't be affected as much. If they used forced split shifts and depend on attrition (people like me pulling the trigger and getting out) they won't have to pay a penny in unemployment compensation. This has been all carefully thought out in Memphis regarding the cash flows.
Time frame.. right now the biggest determinent is the US Congress. If they pull the plug on the RLA, your head will spin as to how fast the changes will come. If Express manages to dodge the bullet again, then the changes will be incremental - as not to raise too much alarm. I said well over a year ago, think of the proverbial frog in a kettle of water. Turn up the heat slow, most frogs will adjust and slowly cook, turn up the heat too fast, most frogs will jump before they cook. I personally reached my tolerance and found a better pond to play in.
"Stand there like a deer in the headlights and wait to get run over..." - why do you think I and others spent so much time in 2009 and 2010 trying to raise awareness? I got out, you should too. If you really want to stay, you should've taken some risks at your station and gotten some people to sign union cards. Most Couriers played it safe in 2009 and 2010 - and will pay the price in the coming months/year.
Now that car is coming around the corner and you're looking at a pair of fast approaching lights, what should you do? You and every other Express employee are faced with the issue of determining just how fast that car is coming around the corner and how much time you have till its too late. From my perspective, it is already too late. You have no control over your career, you are along for the ride/impact. You have to take control of your career and either jump ship or get behind a concrete barrier (unionization) to avoid becoming roadkill.
With respect, you have a propensity for wishful thinking which has cost you dearly over your life (I read that string on 401k's). No one is going to take care of you in this life with the exception of yourself and close family. Signing a union card is the first step in taking care of yourself when you are faced with a highway full of vehicles coming at you intending on turning you into roadkill. When I got information regarding Express, I tried to paint a big picture without revealing too much which would be detrimental to the individuals in Express which pass the information on. It is up to the reader to "connect all the dots" and come up a conclusion upon which they feel is correct.
"People who've worked failthfully.... are they really that uncaring". After all of this time, do you think that a major corporation which has engaged in the practices which it is famous for, actually "cares" for individual employees? Again with respect, you need a reality check. FedEx has had no problem with having drivers work in Ground getting paid the equivalent of $10 and hour with no benefits. As far as FedEx is concerned, your getting $17 and hour with benefits and a PPP is chrome plated compensation.
If you want "caring", you need to try working for a small business where the person you report to is more often than not the owner or part-owner in the business. In a large corporation, busting your ass for them while they attempt to minimize your compensation at every turn is akin to taking a mid-ocean swim without a life preserver and raft nearby. You are a number, a list of characters on a personel roster, an expense which they attempt to minimize by every means possible while staying within the limits of legality.
You have demonstrated a repeated confusion regarding morality and legality. That which is illegal is immoral (vast majority of cases). Everything that is moral is (usually in a free society) legal. There is that overlapping middle ground between varying shades of immoral behavior yet absolute legality. FedEx exists in that middle ground. They maintain legality, but morality is only coincidental to a situation if it creates a profit. Do you call the situation with the Ground drivers moral behavior on the part of FedEx - I don't. It is in that middle ground, bordering between immoral behavior and illegal behavior. Why the change to ISP model? To make sure they stay one step outside the line between legality and illegality. Being on the wrong side of the illegality line hurts profits. Being on just the other side of that line though is usually quite profitable for a large corporation.
Yeah, yeah, yeah, FedEx is top heavy with topped out FTer's who've stuck with them. How is signing a union card going to protect my job? Seriously, if the RLA status is lost wouldn't they want to go to Ground as much as possible to eliminate the threat of the union? I love you guys who want to take personal shots but hindsight is always 20/20. I'm in no shape to make a change in my life and my goal was never to make enough to buy a nice home and car. Once they did what they did to the pension my focus has been to keep an eye on their next moves and how it will affect me and act accordingly. In case you haven't noticed not that many people stick their neck out here and ask questions and in case you haven't figured out why it's because some smug superior jerk wants to eviscerate them. Doesn't accomplish anything but I guess it makes you feel manly. One thing I'm not getting is your belief that attrition will reduce the workforce. I've worked at quite a few stations and it's the PTer's primarily who leave. I've been here almost 3 years and the only FTer's who've left were over 50 and either retired or in one case became an EMT since. With the economy dictating everything there won't be very many FTer's leaving without an incentive to do so. Thus my question. And with FedEx trying to at least keep an illusion that they care they won't do a layoff, especially if it hits them hard in the pocketbook. If they were to offer me $25k to leave about 2 years from now I'd take it. You want to talk about my mistakes but buddy I'm investing in a complete change of scenery that will cost me much less to get by. If you feel manly enough you could too.
"If you want a friend get a dog"-Gordon Gecko
Let me see if I understand this part......
So if a station would sign the union cards and have a majority vote then Fred tries to lock the couriers out, then who would do all the deliveries and pickups? Certainly not the managers or the Senior (most of them don't like to get their hands dirty anyway.) I see a whole days or weeks worth of freight sitting and rotting away.
I'm sure all the stockholders would catch wind of this rather quickly and probably be less than pleased. With all the ass kissing Memphis does to please them and Wall Street this doesn't seem like a logical move on their part.
Or am I missing something?
I knew it.
What I'm figuring is if I only average 36 hrs instead of getting 42-44 a week then I'm losing as much as $180 a week. Multiply that kind of money by 10's of thousands of FTer's and you can see huge savings i.e. huge profits and very happy stockholders. That kind of loss of pay means walking to work, no movies, no snacks, no vacations, and possibly finding a part-time job to make ends meet. Hey LTFedExer, you'll be able to save plenty in your 401k then!
If you budget on the 42-44 hours you get now, you are a fool.
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