FedEx Express and its pilots union are looking to hammer out a deal fast as peak season approaches.
The union for FedEx Express pilots is aiming for a speedy federal mediation process in its ongoing contract negotiations with company management, Capt. Chris Norman, chair of the FedEx Air Line Pilots Association, International, Master Executive Council, said in an interview Thursday.
A top priority for the union is to improve the pilots' pension plan, which was established in 1999. Norman said "no substantive changes in the plan" have been made since, despite attempts to do so during 2006 and 2015 negotiations. Now, the union wants to ensure pilots slated to retire soon get a pension that isn't "stuck with those 1999 numbers."
"Even though we are looking for expediency, we are not going to settle for anything other than fixing our issues," Norman said. "So do I think we will fix the retirement? Absolutely. I think the problem is, how long will this take? Will it be dragged out past this expedited session?"
FedEx declined to comment on the union's pension plan, but the company expressed optimism over the process in a news release Wednesday.
“We are optimistic that involvement of a federal mediator will assist the parties in expediting the negotiation process and, ultimately, resolving the few remaining issues,” said Don Dillman, senior vice president of air operations at FedEx Express, in a statement. “At the end of the day, we all want FedEx to continue to be a great place to work and to be positioned for success in the years to come.”
Past mediations have taken months to be resolved
The current contract negotiation is the first time FedEx and its pilots union have tried to expedite a mediation with the National Mediation Board, Norman said.
The federal mediation process in a previous negotiation, which was not expedited, lasted from Oct. 2014 until a tentative agreement was reached in Aug. 2015. Requesting an expedited federal negotiation should help both parties land a mediator quickly and reach an agreement in a more reasonable time frame.
An expedited mediation can still take several months, however. In the Association of Flight Attendants's 2012-2016 contract negotiations with United Airlines, the parties agreed to apply for expedited mediation in Sept. 2011 and the process ended in Jan. 2012.
A busy time to engage in labor talks
In its news release, FedEx said that moving negotiations to the mediation stage will have no operational or service impact.
Still, the next phase of negotiations will come at a challenging time for the delivery giant. FedEx Express is reducing flight frequencies and temporarily parking aircraft after revenue came in $500 million below company forecasts in Q1, which ended Aug. 31.
As a result, FedEx founder and Executive Chairman Fred Smith, along with the company's board of directors, "will not allow the union to hold the company hostage over what they view as unrealistic demands, given the company's current financial standing," Dean Maciuba, managing partner USA at Crossroads Parcel Consulting, wrote in a LinkedIn post.
FedEx rival UPS and its pilots, represented by the Independent Pilots Association, ratified a two-year contract extension in August, extending the term of the contract until Sept. 1, 2025.
"Certainly a FedEx pilot's worth at least as much as a UPS pilot is, and we don't just compare ourselves to UPS," Norman said. "It is a great comparison, but we have the same requirements as pilots as Delta does, as United does — all the major carriers."
He also noted FedEx pilots have been grappling with various COVID-19 restrictions and quarantine rules across various countries while delivering critical cargo, including vaccines.
"The world shut down for a while," Norman said, later adding: "It didn't shut down for FedEx pilots that continue to fly around the world."