United Parcel Service faces the prospect of dealing with stronger unions that rival Federal Express, following a ruling that the Kentucky-based express freight company is covered by laws favouring unions.
Unless reversed on appeal, UPS will be subject to the general US law that protects union rights to organise and call strikes. The Railway Labor Act, which applies only to railroads and airlines, curtails those rights by mandating mediation and cooling-off periods before any strike because of the perceived national interest in keeping the transport system running.
The likelihood that UPS will be bound by the normal legislation, while Federal Express enjoys the management-friendly protection of the Railway Labor Act, is the result of two decisions by the National Labor Relations Board, which administers the general labour law.
In July the NLRB referred a union complaint against FedEx to the National Mediation Board, the agency that administers the Railway Labor Act, for it to decide whether the dispute was covered by the Railway Labor Act or general labour law.
But when a similar union complaint about UPS came before the NLRB, it denied a UPS request to refer the same jurisdictional question to the National Mediation Board, and instead decided that UPS was not covered by the Railway Labor Act. As yet the Mediation Board has still to rule on the FedEx complaint, but it is widely held that the ruling will come under the Railway Labor Act.
William Gould, NLRB chairman, dissented from the decision to refer the FedEx case to the Mediation Board, but applauds his board's willingness to decide on its own which law applied to UPS. He claims the NLRB is just as capable as the Mediation Board of piercing 'the shadowlands which lie on either side of the boundary' between general labour law and the Railway Labor Act.
His board ruled unanimously that UPS was not an airline within the meaning of the Railway Labor Act, mostly because so few of the packages it handled were shipped by air. 'Notwithstanding the intermodal evolution of UPS, over 92 per cent of its total package volume still consists of ground packages,' the ruling states.
UPS argued that its ground units are an integral part of its air operations - one of its subsidiaries is licensed as an air carrier with some 147 aircraft. But the board found the opposite: '[UPS's] trucking operations are not an integral part of an air carrier operation. Instead, the air carrier operations of UPS Co. exist as an adjunct to [its] truck carrier operations.'
Union leaders hailed the decision, but UPS is expected to appeal and has threatened to ask Congress to change the law.
Source: Airline Business
