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FedEx takes aim at UPS, Teamsters, 'bailout' legislation in Senate

(The following story by Bartholomew Sullivan appeared on the Memphis Commercial Appeal website on June 8, 2009.)

WASHINGTON, D.C. ó In what is shaping up to be a public relations battle royal, FedEx today unveils a multimillion-dollar campaign aimed at rival UPS and at derailing Senate consideration of a law that would make it easier for the Teamsters to organize its drivers.

The advertising campaign and its associated Web site, , counter efforts by the International Brotherhood of Teamsters, with its , to organize FedEx Express drivers as it has the drivers of UPS.

The Web site, made available for preview purposes for 90 minutes Monday afternoon, asks, "Why is mega-corporation UPS trying to use its political clout to get a bailout from the U.S. Congress, leaving you to pay the tab?"

Malcolm Berkley, a spokesman for UPS, read a statement: "FedEx's apparent attempt to raise the noise level here doesn't change the facts. It would appear that FedEx is preparing to spend millions of dollars trying to convince Congress that a FedEx driver delivering a package is different somehow than a UPS driver delivering a package. The packages aren't delivered by airplane, and we don't think FedEx can fool Congress about that."

Teamster vice president Ken Hall said that it was "almost laughable" and "the height of hypocrisy" to claim the legislation is a bailout of UPS.

"The fact is that the only company being bailed out currently is FedEx," Hall said. "They've been misclassifying their employees for decades in order to keep them from enjoying just the same rights as all other employees within the same industry."

BrownBailout.com provides mechanisms for contacting legislators, along with a video that characterizes the legislation as an effort by UPS to put its competitor at a disadvantage. The site also contains survey responses from a poll that indicates 75 percent think reliable overnight delivery is extremely or very important.

No specific reference to the Teamsters could be found on the Web site Monday, although the language in the bill makes it clear that employees of package delivery companies who aren't involved in air deliveries would be affected.

FedEx officials call the 230-word measure, which passed the House last month, a "bailout" for UPS, and say its Atlanta-based competitor is using its clout as the heaviest contributor to the political campaigns of members of Congress. The Senate is expected to take up the measure sometime this summer.

The Teamsters maintain that FedEx drivers who don't deal with the operation of the company's air fleet should be organized as what they are: truck drivers.

Right now, FedEx's regulatory oversight is governed by the Railway Labor Act, which requires national, companywide votes on labor-management contracts. If the language that passed the House becomes law, drivers could be organized into bargaining units under the National Labor Relations Act at the local level.

The purpose of the Railway Labor Act is to prevent single union locals from stopping rail and air traffic nationwide. FedEx is concerned that a strike at any single local could paralyze the entire company operation. With Teamster drivers, it's assumed that work rules and wages will rise, making it harder for the Memphis-based logistics giant to compete.

Rival United Parcel Service, governed by the National Labor Relations Act's provisions, calls FedEx the only company in the transportation industry with ground employees covered by a railroad and airline labor law. UPS drivers are Teamsters.

FedEx CEO Frederick W. Smith has warned that the purchase of Boeing Corp. B777 aircraft, and by implication the jobs of a lot of union laborers, could be jeopardized if the labor provision becomes law.

"Fred Smith and FedEx breed a culture of arrogance," Teamsters president James P. Hoffa said last week. "First, they cut wages, increase medical insurance premiums and eliminate pension benefits for its employees. Then they try to blackmail Congress with threats to pull the Boeing contract. Now they threaten to destroy the political careers of those who oppose them."

FedEx spokesman Maury Lane called the Teamsters comments "dishonest and irresponsible political rhetoric," and said Hoffa's "distorted assertion ... could not be further from the truth."

Larry Cox, CEO and president of the Memphis-Shelby County Airport Authority, said he "definitely supports FedEx" in opposition to the legislation.

Tuesday, June 09, 2009

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