The Teamsters union says negotiations with United Parcel Service (NYSE: UPS) over a new contract have "collapsed," raising concerns that there will be a strike later this summer. Investors are taking the threat seriously, sending shares of UPS down as much as 3% on Wednesday morning.
A contract between UPS and Teamsters-represented employees expires at the end of this month, putting the future of about 340,000 employees in doubt. The two sides have been saying for months they want to reach a deal, but workers have already authorized a strike should the talks break down.
There is a lot at stake for both sides. The union argues that workers missed out on wage increases during the pandemic, and it's hoping to take advantage of widespread labor shortages to negotiate a better deal for its members. UPS, however, is caught up in a cutthroat battle with archrival FedEx and transportation and logistics newcomers including Amazon, and is keeping a firm eye on its costs.
Source Fool.com