UPS cuts wages 20% for hundreds of part-time Philly workers, taking them by surprise

The teamsters union says the pay reduction was illegal.

Workers and labor advocates protested a UPS wage cut on Oregon Avenue

Workers and labor advocates protested a UPS wage cut on Oregon Avenue

Jordan Levy / Billy Penn
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Two thousand UPS workers in the Philadelphia region have signed onto a demand to raise wages after part-time employees were hit with an unannounced pay cut.

A Thursday morning protest organized by the Teamsters 623 Local union drew about 75 workers, elected officials, and organizers to the South Philly UPS complex. The Oregon Avenue shipping center employs more than 1,350 people across customer service, drivers, and warehousing, according to a union spokesperson.

Shamar Hudson, a warehouse worker getting off his shift as the rally began, told Billy Penn there wasn’t any warning from management before his pay was slashed from $19 to $15 an hour.

“We never heard it from a manager,” Hudson said. “You saw it on your paycheck and that was just that.”

UPS worker Maurice Smith found himself in the same situation. Hired at $17.50 per hour last August, he got a raise to $19 — and then this sudden drop. “I thought [the cut] was going to be $17, not $15,” he said.

UPS ramped up hiring during the pandemic as demand for delivery services skyrocketed. Last May, the logistics giant announced it was looking for 500 part-time workers in the Philly region. As part of this hiring push, the company boosted wages to $19, noted Local 623 Principal Officer Richard Hooker Jr., to keep up with rates offered by other shipping and logistics companies.

This month, as hundreds of its Philly-area workers receive a pay cut, UPS is reporting record share prices, and quarterly earnings that nearly doubled from 2020 to 2021 for a profit of $3.9 billion.

“They’re not hurting,” Hooker Jr. said at the rally. “The CEO gets on TV and says they’re a year ahead of schedule while making $14.4 million herself. So you’re gonna take from the people that made those profits available?”

The Philadelphia rally, which also drew elected officials and advocates from other local unions, wasn’t an isolated event.

Teamsters in California and Nevada have also gathered recently outside UPS locations for similar protests. All eyes are on July 2023, when the union’s contract with UPS expires and terms are renegotiated.

Hudson, the warehouse worker, said hours were being reduced along with pay, and that he’s already seen how the changes are affecting the mood at work. “People don’t want to be there, people are coming less, people aren’t really showing up. Some days they’ll cut you before you even get a minute in there.”

UPS adjusts pay based on competitors and industry conditions, through what it calls a Market Rate Adjustment, according to Carmen, a company spokesperson who answered Billy Penn’s questions.

“To reflect local market conditions, we sometimes provide temporary hourly rate increases or bonuses that are in addition to our contractually agreed upon compensation,” Carmen wrote. “These temporary hourly rate increases are based on the time of year, geographic location, and type of job.”

Market conditions aside, Local 623 leader Hooker said the reduction was illegal. “In Pennsylvania wage law, it is illegal to take a member’s wages without notifying them first. They just did it.”

Clarence Bagby, Local 623 president and business agent, said he’s worked at UPS for over 20 years and often seen the company introduce incentives during times of increased need, only to end them when the surge subsides.

“It’s not a surprise to me that they would take the money back once the pandemic is pretty much done. Once the peak season’s over,” Bagby said, “it’s nothing to them to take that money back.”

Wage cut shows ‘no appreciation’ for essential workers, officials say

Councilmember Helen Gym, who was in attendance at the rally, connected her support for the UPS workers to a dissonance in rhetoric and action. For the last two years, she said, workers at distribution centers have been celebrated as “essential workers,” along with healthcare professionals, hotel workers, sanitation workers, and others.

“What the pandemic should have taught us is that we have grotesquely inverted the value scale, where we overpay at the top and underpay the workers who actually do the essential work that allows many executives and corporate leaders to stay at home,” Gym told Billy Penn.

Other officials in attendance included state Representatives Rick Krajewski, Elizabeth Fiedler and Malcolm Kenyatta, also a candidate for U.S. Senate.

Paul Prescod, candidate for state Senate, also spoke at the rally. The wage reduction “shows no appreciation of what they’ve [workers] sacrificed during the pandemic,” said Prescod.

The 2,000 signatures collected by the Teamsters are a demonstration of their reach among employees at Oregon Avenue and in the Philadelphia region, union officials said, hinting it could be put into action when contract time comes around. July 2023 was a recurring date in Hooker’s rally speech, which referenced Jesse Jackson’s 1984 address in Philly that launched his presidential campaign.

Hooker, echoing Jackson, described the story of David and Goliath, and stated UPS workers wouldn’t remain static if contract time rolled around without any demands being met — that they wouldn’t be “rocks just laying around.”

He made another historical reference, one that glanced back as it looked forward to what could be a raucous contract season.

“The last strike we had was in 1997,” Hooker said. “Back then the company was nowhere near as profitable as it is now. Now, they make so much money that they cannot afford a job action.”

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