UPS debt?

[UpstateNYUPSer(Ret)]

The good debt/bad debt I was referring was from a personal finance point of mind. Good debt would be student loans and a fixed rate mortgage. Bad debt would be credit cards and an ARM.


From a corporate point of view, good debt would be funds borrowed at a low interest rate, to improve infrastructure or to expand, which would provide a positive ROI. Bad debt would be having to borrow to cover operating losses.

 

[Catatonic]

Like I said - all sorts of people will be coming up with all kind of crazy stuff.

Social and political reasons? I really don't know too many particular details, but using common sense;

The whole strike was based upon PR. The Teamsters were arguing that UPS was at it's most profitable and not willing to negotiate a fair contract.

UPS was arguing, from what I read, that their volume was "down".

If they indeed held out (they don't need to hold out everywhere, perhaps certain areas?) that would establish lower volume numbers and under the scrutiny of the masses, via PR, UPS could somehow establish that the union was acting upon a misnomer and misleading the public with the 'record profits' angle.

Again, just a quick guess why.

As it turns out, we know who was misleading who.

Funny, I don't remember anything about volume being up or down even being mentioned during the negotiations. Like I said!

What I remembered is UPS wanting to take over the Central States pension fund and the Teamsters saying they wanted to convert part-time jobs to full-time jobs.

Even funnier how that all worked out.

The person misleading everybody is dead now ... RIP.

 

[KillerB]

The good debt/bad debt I was referring was from a personal finance point of mind. Good debt would be student loans and a fixed rate mortgage. Bad debt would be credit cards and an ARM.


From a corporate point of view, good debt would be funds borrowed at a low interest rate, to improve infrastructure or to expand, which would provide a positive ROI. Bad debt would be having to borrow to cover operating losses.

Most start-up companies must borrow money to cover operating losses in their first few lean years of existence. Of these, some poorly run companies fold into oblivion, (Pets.com, Netscape, etc.)... while others blossom into extremely lucrative businesses, with strong sustainable profits. (Amazon.com, Netflix, Google, Facebook, Etc)... These companies leveraged themselves in order to take off... Would you consider that "bad debt"?

Even if that was "bad debt", in fiscal year 2010, UPS produced $5.9 Billion dollars in operating profit... thus, since they have no operating losses to cover, UPS must not have bad debt.

Again, debt is debt no matter how you slice it... its not good or bad. True, with debt instrumentation and various methods of structuring, some debt is better than others. However, only if its mismanaged, will it get a company in financial distress. Otherwise, its a great tool to use and it will get the most out of a company.

 

[tonyexpress]

However, only if its mismanaged, will it get a company in financial distress.

How about the example of Mr. mismanagment himself, Frank McCourt taking the Dodgers down? What a loser!

Frank McCourt, Major League Baseball go toe to toe at bankruptcy hearing

 

[tonyexpress]

Oh and by the way welcome to the BrownCafe, KillerB.

 

[satellitedriver]

Social and political reasons? I really don't know too many particular details,-( obviously)- but using common sense;

The whole strike was based upon PR.
The "whole" strike was based on a power play between Hoffa and Carey.
One's dead, one now is in charge.
Central States is in the crapper.
In 97' 520 million dollars would have bought UPSer's out of Central States, but the control of the money was too important for the internal power play.
Part timers now do the work of full timers.
UPS had to layout 6.1 billion to take UPSer's out of Central States and the scars of division between union and management were set in stone in 97'.

As it turns out, we know who was misleading who.

I know who mislead me in 97', and it was not UPS.
In fact, the strike was a great wake up call for me.
From that point on I took my future back into my own hands.
Fool me once,
shame on you.
Fool me twice,
shame on me.

 

[JonFrum]

Funny, I don't remember anything about volume being up or down even being mentioned during the negotiations. Like I said!

What I remembered is UPS wanting to take over the Central States pension fund and the Teamsters saying they wanted to convert part-time jobs to full-time jobs.

Even funnier how that all worked out.

The person misleading everybody is dead now ... RIP.

Actually, UPS argued adamantly that volume was down to the point of necessitating layoffs!!! That's what the whole 22.3 delay and arbitration issue was all about. UPS insisted it wasn't required to honor its negotiated agreement to create full-time 22.3 jobs, because volume was down causing layoffs. UPS had agreed to create the jobs to settle the strike, then promptly reneged on the centerpiece of their agreement.

Ron Carey had to grieve the issue and then take it to arbitration to get the jobs created. UPS continued arguing from 1997 until March 10, 2000, when the arbitrator finally rejected UPS' strenuous arguements and ordered UPS to create the jobs with backpay and benefits. It's all laid out in mindnumbing detail in the arbitrator's lengthy Decision.

Of course, by the time the arbitrator issued his decision, Hoffa was in charge and snatched "Defeat from the jaws of Victory." For Article 22.3 people, it's been downhill ever since.

 

[pretzel_man]

Actually, UPS argued adamantly that volume was down to the point of necessitating layoffs!!! That's what the whole 22.3 delay and arbitration issue was all about. UPS insisted it wasn't required to honor its negotiated agreement to create full-time 22.3 jobs, because volume was down causing layoffs. UPS had agreed to create the jobs to settle the strike, then promptly reneged on the centerpiece of their agreement.

Ron Carey had to grieve the issue and then take it to arbitration to get the jobs created. UPS continued arguing from 1997 until March 10, 2000, when the arbitrator finally rejected UPS' strenuous arguements and ordered UPS to create the jobs with backpay and benefits. It's all laid out in mindnumbing detail in the arbitrator's lengthy Decision.

Of course, by the time the arbitrator issued his decision, Hoffa was in charge and snatched "Defeat from the jaws of Victory." For Article 22.3 people, it's been downhill ever since.

As I recall, the language for 22.3 jobs mentioned something that volume had to come back? I looked for the exact language, but could not find it.

The company argued that volume was down after the strike and therefore was not obligated to create the jobs. I found quotes from the Heritage Foundation supporting this.

The Teamsters argued that the jobs were still owed (and I think that the volume loss was not due to the strike?).

In the end, UPS lost the court case and created the 10,000 jobs.

At least that is my memory.

 

[JonFrum]

As I recall, the language for 22.3 jobs mentioned something that volume had to come back? I looked for the exact language, but could not find it.

The company argued that volume was down after the strike and therefore was not obligated to create the jobs. I found quotes from the Heritage Foundation supporting this.

The Teamsters argued that the jobs were still owed (and I think that the volume loss was not due to the strike?).

In the end, UPS lost the court case and created the 10,000 jobs.

At least that is my memory.

The exact language, in the 1997 Agreement (and the prior Agreement) was: "If there is a reduction in volume causing layoffs, the Employer’s obligations under this section shall be null and void."

The "causing layoffs" phrase was the biggest bone of contention. Hoax doesn't seem to remember this being an issue, but the Arbitrator said in part:

"This case arises out of a provision agreed upon as part of the settlement of the strike of August 1997. In that settlement, the Company agreed to create a certain number of new full-time jobs, with the commitment to be "null and void" if there was a "reduction of volume causing layoffs." The jobs were not created and the issue to be decided here is whether the Company’s failure to do so was a violation of its contractual obligation.

To be more precise, the issue agreed to by the Parties is:

Whether UPS violated Article 22, Section 3 of the Master Agreement when it failed to create 2000 full-time jobs from part-time jobs during the contract year ending July 31, 1998? If so, what shall the remedy be?

I held a hearing on that question on December 16 & 17, 1998, February 24, March 4, May 19 & 20 and July 26 & 27, 1999, at which time both Parties were afforded full opportunity to offer evidence and argument and to present, examine and cross-examine witnesses. There were 23 witnesses, 124 exhibits and a transcript of 1622 pages. At the conclusion of the testimonial phase of the proceeding, the Parties filed exhaustive briefs and reply memoranda, with the Record closed on December 1, 1999, the day of their receipt."

 

[Catatonic]

The exact language, in the 1997 Agreement (and the prior Agreement) was: "If there is a reduction in volume causing layoffs, the Employer’s obligations under this section shall be null and void."

The "causing layoffs" phrase was the biggest bone of contention. Hoax doesn't seem to remember this being an issue, but the Arbitrator said in part:

"This case arises out of a provision agreed upon as part of the settlement of the strike of August 1997. In that settlement, the Company agreed to create a certain number of new full-time jobs, with the commitment to be "null and void" if there was a "reduction of volume causing layoffs." The jobs were not created and the issue to be decided here is whether the Company’s failure to do so was a violation of its contractual obligation.

To be more precise, the issue agreed to by the Parties is:

Whether UPS violated Article 22, Section 3 of the Master Agreement when it failed to create 2000 full-time jobs from part-time jobs during the contract year ending July 31, 1998? If so, what shall the remedy be?

I held a hearing on that question on December 16 & 17, 1998, February 24, March 4, May 19 & 20 and July 26 & 27, 1999, at which time both Parties were afforded full opportunity to offer evidence and argument and to present, examine and cross-examine witnesses. There were 23 witnesses, 124 exhibits and a transcript of 1622 pages. At the conclusion of the testimonial phase of the proceeding, the Parties filed exhaustive briefs and reply memoranda, with the Record closed on December 1, 1999, the day of their receipt."

Actually, you are using my quote out of context.
Sleeve said "The whole strike was based upon PR. The Teamsters were arguing that UPS was at it's most profitable and not willing to negotiate a fair contract.

UPS was arguing, from what I read, that their volume was "down". "

The context that I was speaking to was that the strike was called because UPS was saying volume was down.

What you are talking about was whether volume was down after the strike was over and whether UPS should have created 10,000 22.3 jobs.

These two contexts are not even close in time or argument.

What else have you misconstrued in your argument? At this point I don't take anything you post with any credibility since you obviously "lied" about what I said.

 

[JonFrum]

Actually, you are using my quote out of context.
Sleeve said "The whole strike was based upon PR. The Teamsters were arguing that UPS was at it's most profitable and not willing to negotiate a fair contract.

UPS was arguing, from what I read, that their volume was "down". "

The context that I was speaking to was that the strike was called because UPS was saying volume was down.

What you are talking about was whether volume was down after the strike was over and whether UPS should have created 10,000 22.3 jobs.

These two contexts are not even close in time or argument.

What else have you misconstrued in your argument? At this point I don't take anything you post with any credibility since you obviously "lied" about what I said.

I was responding to several things you said in this thread. Go back and read what you said.

The Arbitration was over the lack of creation of 2000 jobs in the first Contract Year, not the whole 10,000.

Like I said, the "reduction in volume, causing layoffs" language was a big issue in both the 1993 and 1997 negotiations. In fact, the 1993 jobs wern't created until the end of that Contract, and only after an Unfair Labor Practice charge was filed against UPS.

I tried to post the Arbitrator's decision so everyone could read for themselves, but the Browncafe rules won't allow a 113kb HTML file attachment. I can't accurately summarize 34 screenfuls of text in one post. Post an email address and I'll send you a copy.

The Arbitrator's discussion about volume reduction and layoffs starts in 1993 and continues on from there. (This doesn't necessarily mean volume was always down; just that it was an ongoing topic of discussion in both negotiations, and cited as an ongoing excuse for delay in creating the agreed upon jobs.)

 

[whiskey]

Back in 1997, all my customers asked me if there was going to be a strike. And I said yes, I really think there will be a strike and you should make the neccessary arrangements to protect your business. There were many small businesses operating with very narrow profit margins that had to roll the dice, stay with UPS, and they got burned badly.
The 97 strike was an old fashioned peeing contest between Kelly and Carey. Could this happen again? No way. Our current CEO doesn't have brown blood. The next chapter could be much worse.