UPS, UNION RACE TO HEAD OFF STRIKE

UPS, UNION RACE TO HEAD OFF STRIKE

Faced with a possible strike by Thursday, United Parcel Service scheduled negotiations with the Teamsters union through this past weekend in a last- ditch effort to hammer out a labor contract for 165,000 UPS workers.

The union last Thursday rejected the second UPS wage and benefits offer, which called for a wage increase of about 45 cents an hour for the first four years in a five-year contract. In the fifth year, the offer would have increased to 50 cents more an hour.A month ago, the union rejected the company's first economic offer, which called for a 35-cent-an-hour increase in each year of a six-year contract.

But Ken Sternad, a UPS spokesman, said the latest offer was by no means final, and added that UPS hoped to have a handshake agreement by Sunday night.

The union and UPS have negotiated since March and are now two months past the Aug. 1 expiration date of the existing labor contract.

The union last week gave UPS a notice that after Wednesday, it may take job actions "up to and including a strike."

Following the announcement, concerned shippers promptly sought other carriers to carry their freight, UPS acknowledged.

"A lot of customers are upset, and we have lost a significant amount of business," said Mr. Sternad, declining to give a specific amount. "I don't think they (the Teamsters) have any concept of what they did. When we lose business, it ultimately means we lose jobs."

Both sides said negotiators had made significant progress on some major sticking points. UPS originally sought to place Teamsters on a company- sponsored health-and-welfare plan, which would have paid more benefits but sapped Teamsters-sponsored benefits funds.

By Friday, UPS had dropped that demand, and offered an additional 35 cents- an-hour equivalent into the Teamster plans. But Mr. Sternad said the company was still sticking to its demand that it use non-union employees for its new Three Day Select delivery service, which the union has strongly opposed.

In its 86-year history, UPS has never had a nationwide strike, although it has had regional job actions prior to the national contract. Both the union and UPS said significant progress had been made on various regional supplemental agreements, which was the focus of Friday's talks.

UPS, fearing additional loss of customers, said it would report by this morning to customers on the status of talks.