FedEx Corp. and the union representing its pilots said Wednesday they have reached a tentative agreement on a new contract that will ensure uninterrupted parcel and freight service if approved by rank-and-file pilots. The deal is so fresh that the FedEx pilots’ leadership, which must first give its approval to go forward, still hasn’t seen the text.
Two weeks ago, FedEx (NYSE: FDX) pilots authorized the Air Line Pilots Association (ALPA) to call a strike if contract negotiations were stalemated after exhausting all procedural steps required under federal labor law. The remaining sticking points were over pay levels after officials said they had resolved retirement and quality-of-life issues, such as scheduling practices.
Terms of the preliminary labor pact were not provided because the final language is still being hammered out. In a message to members, Capt. Chris Norman, chairman of ALPA’s FedEx Master Executive Council (MEC), said the council is still waiting for negotiators to present the final package. The union board must endorse the tentative agreement before it can be sent to members for a ratification vote.
The MEC is preparing to meet in Memphis, Tennessee, in early June to decide whether to endorse the tentative agreement, an ALPA spokesperson said.
The preliminary contract agreement comes less than a week after more than 500 FedEx pilots picketed in front of the FedEx Express Air Operations Center in Memphis to protest their frustration with the pace of talks.
“Throughout the negotiations process, it has been the unity of our pilots that moved the needle and helped deliver this tentative agreement,” Norman said in a separate news release. “We thank our pilots for their continued professionalism and willingness to show up and be counted when it mattered most.”
The two sides have been negotiating for two years and the contract became eligible for amendment in November 2021. ALPA has said pilots are working under contractual provisions and benefits negotiated in 2015. Talks in recent months took place under the auspices of federal mediators who worked to push both sides to a compromise.
A strike was not imminent because federal law governing airline labor relations requires both sides to follow a lengthy process before anyone can take unilateral action, but events were moving in that direction.
The news of a labor contract takes place against a backdrop of declining shipping volumes and profits at FedEx, which has instituted a multibillion dollar cost-cutting plan that includes closing a handful of pilot bases, as reported by FreightWaves. The union has said pilots are worried that flight reductions are reducing the most lucrative routes for pilots and that there could be job losses if FedEx shrinks its fleet.
FedEx would join UPS, Hawaiian Airlines and Delta Air Lines in completing collective bargaining with their pilots this year.
Cargo airline Air Transport International and its pilots are also negotiating with the help of federal mediators. Pilots at United Airlines and American Airlines turned down contracts negotiated by union leaders in hopes of matching the deal Delta Air Lines pilots received early this year. Southwest Airlines’ pilots also authorized a strike.