SANDY SPRINGS (dpa-AFX) - UPS announced Thursday it will offer voluntary buyouts to its union-represented delivery drivers for the first time in its history, as part of a sweeping effort to restructure operations and improve profitability.
Drivers opting for the buyout would receive a substantial financial package in addition to their accrued retirement benefits, including pensions and healthcare.
The Atlanta-based logistics giant is grappling with a post-pandemic decline in parcel volumes, compounded by supply chain disruptions and tariffs implemented under former President Donald Trump that have complicated global shipping routes. Earlier this year, UPS outlined plans to cut 20,000 jobs and close 73 facilities as part of its largest-ever network reconfiguration.
The buyout plan was first disclosed by the International Brotherhood of Teamsters, which represents about 330,000 UPS workers.
The union sharply criticized the proposal, calling it an 'illegal violation' of their national contract, which had included commitments to create more than 22,000 new union jobs.
'Our members cannot be bought off, and we will not allow them to be sold out,' Teamsters General President Sean O'Brien declared, urging workers to reject the buyout offer.
UPS responded that it remains committed to its 2023 labor contract and is in talks with the union over the buyout terms. The company's current contract included significant wage increases and benefits that have weighed on profit margins amid lower package demand.
UPS shares fell 1.3 percent on Thursday and are down more than 17 percent so far this year, trailing the broader S&P 500. The move highlights UPS's urgent push to adapt its network and workforce to changing economic and industry conditions.
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