FEDEX PILOTS REJECT CONTRACT AS BALLOT LOOMS AT UPS

FEDEX PILOTS REJECT CONTRACT AS BALLOT LOOMS AT UPS

Federal Express pilots have rejected a contract offer from management, but whether the pilots at competitor United Parcel Service will follow suit when their ballots are counted Tuesday remains to be seen.

The contract negotiated between the UPS Independent Pilots Association and UPS management in January closely mirrored the pact FedEx pilots rejected this week.The FedEx Pilots Association rejected the contract by a vote of 1,322 to 1,023, despite leadership's recommendation that it be accepted. The proposal would have given pilots an 11 percent pay raise over three years. Critics of the contract said work-rule changes could mean longer hours on the job for the same or slightly more pay, and they questioned management's freedom to lease outside planes and crews.

Though terms of the agreement reached between UPS and its pilots in January of this year were not disclosed, the six-year pact is widely thought to be comparable to what FedEx pilots won.

In talks that had dragged on since December 1995, UPS pilots had originally sought a four-year ''best-in-the-business'' contract that compared them to the 10 major U.S. airlines and included a 21 percent pay increase retroactive to 1996, and 2.5 percent in later years. They later agreed to accept the FedEx terms as a benchmark.

IPA leaders also recommended their members adopt the contract.

The IPA is due to announce the outcome of the vote on Tuesday. But whether it will be swayed by developments at FedEx is questionable.

Most of the ballots are already in and were therefore cast before the FedEx rejection, but, an IPA spokesman suggested, discussion in the field may have shaped the vote.

''I think they're two separate and distinct groups and two separate and distinct contracts, so I don't know if you can glean anything from what happened at FedEx,'' said Brian Gaudet, an IPA spokesman. But, he said, ''pilots talk. That's a reality.''

Some analysts, however, said the UPS contract likely contains an elastic clause guaranteeing UPS pilots whatever FedEx pilots eventually adopt.

If the IPA contract is automatically pegged to the FedEx agreements, there will be no need for IPA to renegotiate with UPS management to improve its terms.

''If the benefits automatically flow through to UPS pilots, I don't see any need for further action at UPS,'' said David Hoppin, a principal at MergeGlobal, a cargo consulting firm.