From the CEO

Responding To The CEO

4/12/97

On March 3rd, FedEx managers across the nation received a 7 page memorandum from Fred titled “From the Chief Executive Officer” and subtitled “People-Service-Profit Philosophy VS. The Competition.” This document was designed to educate managers on the threat posed by unions and offered those managers arguments they might use in addressing the topic of unionization with workers reporting to them. What follows is essentially an open-letter response from me to our CEO regarding issues he raised in this memorandum.

Initially, Fred sets the tone of the document by attempting to unveil hypocrisy in the movement to organize FedEx by noting the irony of the fact that both the Teamsters and UPS management, two entities which normally have an adversarial relationship, are united in their desire to see FedEx unionized. He encapsulates this indictment by stating:

“Every FedEx employee should think long and hard about why our fiercest rival in the marketplace would assist the union with which they have a collective bargaining agreement, if there were not some real-world tangible benefit to UPS as well as to the Teamsters.”

Having not personally witnessed, nor having heard of any UPS management people actively or passively involved in assisting FedEx employees in their quest for unionization, I naturally wondered what basis in fact Fred was referencing when he cited this conspiracy theory. It wasn’t until I got near the very end of his memo that I finally found Fred’s explanation for this theory. For the sake of remaining as congruent to his memo’s structure as possible, I’ll address his conspiracy theory later in this article. For now though, let’s address Fred’s stated concern. Even though I can tell you now that UPS management really doesn’t want us organized, let’s assume, for the moment, that Fred’s information is accurate. What Fred is really driving at here is that if both UPS management and the Teamsters want us to be organized, it must be bad for us! Could he be right? That depends largely on us... and on Fred!

I know I’m going to probably anger our friends at Airborne and UPS who have been working with us in our organizing drive by what I am about to say, even though I mean no offense by it, but that’s a chance I’ll have to take. You see, FedEx workers are smarter than the average transportation industry worker! That’s just plain fact boys and girls. When I was hired at FedEx, the recruiting people made no effort to conceal the fact that they were looking for some college education in their prospective employees. They also asked for a resume. Furthermore, I went through three separate interviews and a psychological screening test prior to being hired. Conversely, at UPS, all I ever did was fill out an application, take a physical and I was in the door!

All things being equal, FedEx employees have far more technical expertise than their peers at other companies. We have to know how to enter data into computer terminals to do manual PODs, print up CONS, run our V41s, time cards, IIB23 and IIB07 screens and most importantly, we have to understand all of this. Many of us also know how to use the corporate e-mail system, make jumpseat reservations, change personal data, order equipment and uniforms and perform a myriad of other functions through the computer terminals at work. We are the only employees in our industry who are required to take a 90 question exam on topics ranging from hazardous materials handling to import/export prohibitions every six months and we’re required to be adept at finding information in a small library of publications! The job requirements of our peers at Airborne and UPS pale by our standards. This is not mere opinion, it is hard fact!

Okay, so what does this have to do with Fred’s sinister implications? Well, in order for Fred to be correct in his assumptions, he has to make the leap of faith that whatever contract we might negotiate will have to be identical to those the competition has negotiated. In short, Fred has to be assuming that we’ll follow like sheep to the negotiating table without exerting any meaningful influence in the contract formulation. Yet I give FedEx workers far more credit than that. I cannot, in my wildest imagination, believe that FedEx employees would be stupid enough to make unreasonable demands that would rob us of our ability to remain competitive in the industry!

Given that we’re smarter than the average bear, organizing FedEx will be a unique experience for whatever union that winds up representing us. There is no way that FedEx workers want, or would sit still for a cookie-cutter contract patterned after those which our competitors have with their employers! To begin with, there’s far too many ex-UPS workers among the ranks at FedEx who clearly understand that some work rules at UPS simply couldn’t be implemented at FedEx without throwing a monkey wrench into our operation. We are a unique company with unique work parameters that will demand an equally unique approach in the negotiating process. Former UPS employees working at FedEx would likely be prominent voices offering their insights as to the obvious differences between our needs and those which present UPS workers have. In short, any union will likely find that FedEx workers have their own ideas about what they want and won’t support a contract simply cloned from other agreements.

Fred also completely ignores his and FedEx management’s role in how smooth a transition to a unionized company will go. Contract negotiations are a two-way street. Personally, I do think that negotiating a contract with FedEx management will be a very contentious process. It’s not that I believe that our demands would be unreasonable. It’s simply because Fred has demonstrated such an abundance of disdain for unions that he will likely be the inflexible party in any negotiations that take place. Fred, after all, is an ex-Marine. Every jar-head I’ve ever met thought he could walk on water and raise the dead. He likely has an enormous ego and the stubborn disposition attendant to such psyches. Just being forced to sit at a table with union officials would probably be maddening for Fred, as it would seem demeaning to him and bruising to his ego. I hope I’m wrong. I hope Fred’s intellect overrides his urges to give in to knee-jerk emotionalism. Whatever happens though, if a bloodbath occurs at the contract negotiations, I firmly believe that the first shot will be fired from Fred’s side of the table.

It’s important to understand that the mantra of impending doom that unionization will bring has been religiously repeated by management in virtually every company that has ever found itself faced with a budding union movement. We therefore shouldn’t be at all surprised to find Fred quoting from this same play book.....

The next portion of the memorandum goes into great detail about how much larger and more profitable UPS is than FedEx. It paints the portrait of overwhelming odds against us and imbues the reader with a sense of imminent disaster lurking just around the corner for FedEx if..... At this point, you have to ask yourself two questions about Fred’s thinking where business in America is concerned. Does he honestly believe that in order for a company to thrive and survive it has to be of equal size and generate as much profit as its competitors? If that were true, only one airline would be in business, we’d all be driving the same make of car and we’d all be drinking the same brand of beer! If Fred doesn’t think that way, then the other question that one has to ask where his thinking is concerned is, “What’s your point Fred?”

Of course, we all know that Fred doesn’t see American business success as being dependent upon being a monolithic and monopolistic entity. We also know that his real point in regaling managers with David and Goliath charts, graphs and figures is to fill them with fear of the prospect of a unionized workforce. Truth be told, this type of fear-generating rhetoric is likely to have far greater impact upon its targeted audience, namely front line management, than upon hourly employees. Most managers can see no positive aspects of unionization. Yet, ironically, managers stand to gain a great deal if a union comes to FedEx. For one thing, in order to keep present managers and attract new ones, FedEx will have to raise management’s salaries proportionally to any wage increases negotiated by a union. For another, management will be forced to observe a well-defined set of guidelines where disciplinary matters are concerned so they won’t be compelled to discipline or terminate employees when they know in their hearts that the punishment is unjust. But I’m straying afield here and this is a topic for another article.

Funny thing about this part of the memo from Fred is that he correctly attributes the company’s success in the face of stiff competition primarily to the dedication of FedEx employees that sets us apart from the competition. Yet, in virtually the next breath, he states the following:

"We have had to make some tough decisions over the last ten years, but we have done those things that have allowed us to survive and succeed.”

After reading that sentence I found myself reminded of an old joke where the Lone Ranger and Tonto find themselves suddenly surrounded by hostile Indians. The Lone Ranger turns to his trusty Indian friend and says; “Well Tonto old friend, it looks like we have come to the end of the trail!” Tonto then looks at the Lone Ranger and says: “What do you mean “we” paleface!”

While Fred peppered his memo with charts and graphs, one that he omitted was the one showing the raises he and his VPs have enjoyed over that 10 year period of “tough decisions!” Of course, the reason why Fred omitted that particular chart is that the “tough decisions” that were made only affected our pocket books, our job security, our benefits and our dignity!

In the next paragraph, Fred says:

“We’ve implemented goal congruent pay programs to better align employee opportunities with the Company’s goals.”

Fred’s being exquisitely honest here! It’s become obvious that FedEx’s goal is to pay employees as little as possible by setting unreasonable goals thus limiting our opportunities.

In the same paragraph he goes on to say:

“We’ve continued to hammer away at our service issues”

That’s so true. "Hammer" was a most appropriate and perhaps telling choice of words on Fred’s part. However, if Fred wanted to accurately complete his report, he should have gone on to say that couriers, the ultimate deliverers of our service, have been the recipeints of those hammer blows! Signing memos, immediate reporting of lates and mandatory written explanations have all been routinely used to “hammer” fear into us about those “service issues!”

Fred then offers a graph that illustrates that the profit on a US domestic package has dropped from $1.99 in 1991 to $0.73 in 1996. The steadily declining bar graph is designed to provide an ominous image of a company in financial decline. Yet, our revenues from last quarter were almost double those from the same quarter the year before. Furthermore, international shipment profits were suspiciously left out of the grim financial portrait Fred was painting. Why? Since we “domestic” personnel handle all of those international shipments, why are they conspicuously missing from Fred’s report?

Fred ends this particular part of the memo by trotting out the ubiquitous union bogeyman that threatens the very existence of the company. The fantasy scenario Fred attempts to create is clearly evident when he says;

“A third party, with no history of association with this company, and no true stake in its future, could, through an inflexible negotiating strategy, undercut the ability of FedEx to provide consistently superior service at reasonable rates to its customer base.”

This is going to be fun to dissect! First of all, the reason the unions have no “history of association” with FedEx is because Fred lobbied so furiously at the company’s founding to get us unfairly placed under the jurisdiction of the RLA in a deliberate ploy to keep any union from developing an “association” with us! Now he has the unmitigated gall to use this fact as some sort of indictment against the union! Fred! It’s your fault that the unions have had no partnership with FedEx from day one! Are you listening?

Secondly, Fred clearly demonstrates his willingness to talk out of both sides of his mouth by stating that the unions have “no true stake” in FedEx’s future. We have all read pronouncements from corporate management that the only reason the unions want to organize us is that they are in dire financial straits and that their membership is declining. If we assume Fred and his managers have been telling the truth about the unions (Try to keep from laughing hysterically!) then wouldn’t they indeed have a huge stake in our future? After all, if FedEx goes down the tubes, the unions certainly won’t be able to collect dues from 100,000+ unemployed workers now will they? Seems to me that if the unions do succeed in organizing FedEx workers, they’ll do everything in their power to keep those dues flowing.

Lastly, the Teamsters, through their long history with UPS, have demonstrated a highly flexible negotiating strategy that has allowed UPS to grow, thrive and succeed for over 90 years! Likewise, the UAW has negotiated contracts where they’ve accepted wage freezes and even wage cuts when companies they were negotiating with were undergoing difficult financial times! Why would Fred concoct a fantasy scenario that has the unions dealing with our company so differently than they have with UPS, Chrysler, Ford or GM? It’s as if Fred wants us to believe that UPS has put out a contract on FedEx and the Teamsters are the designated hit men charged with carrying out that contract!

In the next section of his memo, Fred attacks the unions full force. He begins by noting the decline in union membership over the past 40 years from 35% of the labor force to 10% today. He blames the decline in union membership on the fact that unions sell a brand of employee relations that is no longer relevant. Up until a few years ago, I would have agreed wholeheartedly with Fred. After all, the sweat shops have been driven deeply underground or out of existence. OSHA has done wonders to insure that safe working conditions have become fairly universal. Laws are in place to govern the number of hours an employer can demand of its employees etc. etc.

However, American businesses have become cocky and complacent in the face of declining union presence in the work place. FedEx is a classic example of such complacency. Having survived a quarter of a century unscathed by serious union threats, FedEx has continued to push the envelope of endurance of its employees believing that they could get away with whatever they wanted! At the same time, FedEx has literally blazed new trails in using technology to exercise ever-tightening control over the human beings that work for it. As FedEx has done this, the level of stress and intimidation among employees has risen in direct proportion to the encroachment of technology. Once upon a time, American businesses were content to merely use technology to replace workers. Today, FedEx and other corporations are all too willing to use technology to reduce the employees they must retain to utter automatons!

I don’t claim to be a prophet or psychic, but as technology is further used to control and dehumanize workers, I think we will see a resurgence of unions in this country. Furthermore, I believe that the unionization of FedEx could very well be the watershed of the decline of union membership because if we succeed in becoming a union company, workers everywhere will hear about it and identify with the problems that brought us to the brink! I see the unionization of FedEx as something that will send shockwaves throughout this entire country and I think it will embolden workers everywhere to revolt against “Big Brother!”

Possibly the funniest part of Fred’s memo is where he says:

“The reason for the Teamster’s and UAW’s desire to represent FedEx employees is simple: MONEY!”

Isn’t it hilarious that one of the leading businessmen in the country has the brass to actually try to make the pursuit of “money” look disingenuous when someone else is the pursuer? The unions could simply return the indictment by saying....

The reason Fred Smith desires that the Teamsters and UAW not be the representatives for FedEx workers is simple: MONEY!

Fred wants to hold onto as much of that green stuff as he can. I can’t say as I blame him either. But at least he could be honest about it instead of trying to come off sounding holier than thou where the pursuit of money is concerned...

In the next paragraph, Fred tells an outright lie in black and white! He states that the UAW’s strike and pension funds are depleted. At last report, the UAW had $770 million in their strike fund and that was just last month! In fact, the UAW’s strike fund has been healthy for some time now and because of that, it has rebated locals throughout the country an extra ten cents out of every dues dollar for the past several years because its strike fund had surpassed its target funding level of $500 million! Fred! Why are you lying to your own managers?

And while the Teamsters have admittedly had problems with their funds, Ron Carey, President of the Teamsters International has made great strides in turning this problem around and the union’s coffers are now rapidly recovering! Here in Chicago, Ed Bradshaw of Local 710, the Teamsters local working with FedEx employees in this area, stated that in Local 710's coffers alone there presently is 1.129 billion dollars in the Pension Fund and 59 million dollars in their Health and Welfare Fund! If that’s financial distress in Fred’s book, my reply is that I could sure use some of the same kind of distress!

As I said in last months article “Matters of Fiction,” no piece of FedEx anti-union propaganda would be complete without showcasing corruption in the unions. Yet, while the unions have had problems with mismanagement and unscrupulous members in their ranks, Fred would love for you to believe that nothing has changed since the days of Al Capone! Despite their having billions of dollers in their coffers and electing reformers to their leadership positions, Fred continues to paint a fantasy portrait of thugs lined up in union offices to kiss Don Corleone’s ring!

Next on Fred’s list of indictments against the unions is his assessment that they “often” sacrifice the long term job security of their members by making unrealistic demands and calling for strikes and walkouts. Fred goes on to offer a list of now defunct trucking companies which he claims the unions drove out of business over the “last several decades.” To be precise, he lists 27 different companies. Now, I don’t know exactly how many decades are in a “several,” but the way I learned subjective quantitative terms, a couple equals two, a few equals three or four and “several” is five or more. But lets be magnanimous towards Fred, shall we? Let’s say that “several” to Fred is three. So that means that over the past 30 years, if he is being factual in his reporting, the unions have driven 27 trucking companies out of business. That’s less than one per year boys and girls! Anyone out there care to hazard a guess as to how many non-union companies across America went out of business through mismanagement and inability to compete in the market place during that same period? If you guess thousands upon thousands, you’d be right!

Following Fred’s line of logic, if the unions should be condemned for driving 27 companies out of businesses, then we ought to declare war on Japan and other countries abroad and place the leadership of successful American companies in front of firing squads! After all, if condemnation is the order of the day for driving 27 companies into ruin, wouldn’t nukes and death be a proportional response to those responsible for thousands upon thousands of ruined businesses? Ain’t logical analogy wonderful!

And speaking of that list of companies, there were only two names on the list whose names I recognized at all. So who knows how many shoestring “Ma and Pa” companies were on that list? Not only that, but Fred offered not one shred of evidence to support his claim that the unions drove those companies out of business! No testimony from former CEOs. No quotes from trade journals. Nothing! But then Fred wouldn’t lie to us, would he? Oops! Almost forgot about that whopper he told about the unions being broke! Hmmmm........

The next topic Fred covers is the reason why UPS can pay their delivery employees a higher wage. He claims that because UPS has a “near monopoly” in the non-express parcel delivery business, they can use that “cash cow” to subsidize their express business. When I first read this, I experienced a spooky feeling of deja vu! Then I realized that I had heard the exact same type of doom and gloom pronouncement some 20 odd years ago! The only difference was that I was wearing a brown UPS uniform then and the sob story was being recited by a UPS manager who was whining about how the Post Office subsidized their parcel business via the “cash cow” of their enormously profitable first class mail!

So Fred, take some advice from a brother Vietnam vet. Get over it! UPS whipped the Post Office at their own game, first class subsidies and all, because they offered a far more reliable service in a far more timely fashion than the slugs at the Post Office could! FedEx has, and can continue to run circles around UPS people in the same way if you give us reason to continue to do so! In short, treat us like human beings instead of robots, pay us a wage that keeps us abreast with the cost of living, stop subcontracting out trucking jobs just to avoid the unions and stop firing our brothers and sisters for idiotic and shamelessly cold-blooded reasons and we’ll keep the UPS bogeyman at bay!

Fred then brings up a topic which he believes is so crucial that he underlined it! He states that;

“FedEx couriers are paid a higher hourly wage than UPS’ “express-only” couriers.”

My answer to that would be “I’d hope so!” After all, one drives a step-van full of boxes while the other tools around in an Econoline delivering letters, paks and small boxes! FedEx couriers, at least in my neck of the woods, do both jobs! Yet Fred acts as if we should be slobbering with gratitude because we’re getting paid more than UPS’ express-only couriers! Wonder if they have to take a JKT every six months? No? Oops! Wonder if any three letters in their file will get them fired? No? Oops! Wonder if they have to know how to work with UPS’ computer system? No? Oops! Wonder if their annual wages depend upon reaching a 113% of stops-per-hour goal? No? Oops! Sorry Fred, but I, for one, fail to see any valid comparison between UPS’ “express-only” drivers and FedEx couriers.... Nice try though!

Think you’ve heard some good stuff thus far? Well, fasten your seat belts, because this next part will have you falling out of your seats laughing! Now Fred begins blowing his own horn by trotting out “job security” as a benefit at FedEx. Hey Fred! Tell that to Darrel Anderson, Rory Trotter, Abe Santiago and the three other 10+ year employees I talked to long distance this week who’ve been canned! Well over 100 years of cumulative service to the purple and orange flushed down the crapper because of poorly attached DADs units, timecard errors, flunked computer tests and other trivial bovine excrement! Not a single case among them of having failed to meet our customers' expectations! Some job security you offer Fred!

As for no layoffs, that’s pretty easy to accomplish if you keep a small army of casual employees stringing along hoping for permanent status, if you cut back hours to the bare bones, if you suspend guarantee pay as it suits your whims and pull any number of other rabbits out of your magician’s hat to maintain that flimsy claim....

But then Fred really steps in it! He actually had the temerity to mention that the grievance process drags on at UPS for a year and a half on average while at FedEx, the GFT process lasts an average of 30 days! Didn’t I tell you you’d be roaring with laughter soon? Fred’s actually bragging that FedEx can slam the door on an employee’s career in 1/18th the time UPS can! Furthermore, Fred somehow forgot to mention that it’s more than four times easier to lose your job at FedEx and wind up in the perilous grasp of the GFT process than it is for a UPS employee to wind up at a grievance hearing!

By the way, if you’re wondering where I came up with that four times figure, just do a little simple math. At UPS, a letter stays in your file for 9 months. At FedEx it stays forever but “counts” for 18 months. That makes it twice as easy right there. Then take into consideration that a UPS employee has to have three letters for the same infraction in his file before he can be terminated while any three letters in your file at FedEx gets you canned. This essentially means that a UPS employee can have 2 letters in his file for absenteeism, two letters for missed pickups or other on-road mistakes and two letters for minor conduct infractions, accidents etc. etc. and still have his job until he gets a third letter in one of those categories. Again, I’m being magnanimous by only saying it’s four times easier to get fired from FedEx..... But then again, I’ve always been a generous sort of fellow.

Next Fred talks about the SFA and how responsive the company is to issues raised by the process. He cites as examples, IPP, MLI (market level increases), top-of-range raises, MIC/PIC payouts (lower management and salaried people incentives), an additional Vanguard investment option and dependent vision care.

I don’t think I need to say anymore about IPP than I already have elsewhere on this site. As for MLIs, since we haven’t had one in Chicago for the past three or four years, I guess Fred figures that the cost of living has remained static in the Chicago market for that long. Then again, MLIs really have nothing at all to do with true market levels! MLIs are nothing more that incentives to keep and attract people to a particular geographic area or station. If people in a particular area have traditions of staying near their families and tied to their roots in an area, they are punished because Fred feels no need to raise their wages to keep them there. On the other hand, if a senior manager of a station is a first-rate jackass who drives people away, Fred will boost the station’s MLI to get replacements to apply for the positions left behind by the couriers who were driven away. In short, MLIs discourage those “traditional family values” we hear so much about nowadays and offset the results of tyrannical station management.

I already talked about the top-of-range raise seniority employees received this month in articles elsewhere on this site, but it bears repeating that the raise was announced 5 months in advance at a point in time where the unions were making concerted efforts all over the country to organize us and were fighting a high profile battle in Washington over the FAA Reauthorization Act revision. So when you next see your local union representative, don't forget to thank them for our April raise! That is, of course, if you were one of the employees lucky enough to get it...

I don’t know enough about the impact of the MIC/PIC program or the value of the Vanguard option to comment on them but the dependent vision care benefit was something that should have been in place all along! Vision care for dependents is fairly commonplace in the American corporate world as an employee benefit.

The next part of Fred’s memo, in my opinion, is the cruelest joke he unintentionally tells in the entire publication. He boasts of the pension fund and how, in fact, it’s actually "overfunded." He even underlined overfunded! We’re talking about a company that’s 25 years old here! How many people thus far have accumulated 30 years of employment in a company that’s only 25 years old? So is it any wonder that the pension fund is overfunded? Nobody’s using it for all intents and purposes! Furthermore, at the rate FedEx is firing its 10+ year employees, there’s a great chance that the pension fund will remain overfunded ad infinitum!

In the next breath, Fred comes dangerously close to violating a federal labor law which states that an employer cannot threaten to take away existing benefits to thwart union organizing efforts. He tiptoes carefully around the law by implying that since the Teamsters require an employee to work in one location for 25 years in order to qualify for full pension benefits, people who take advantage of JCAT transfers would lose their pension funding accumulated at their old location whenever they transferred to a new location. Aside from the implication that the Teamsters will be responsible for the downfall of JCAT transfers, Fred dives off the deep end into a pool of utter fantasy here, and in doing so, once again insults the collective intelligence of FedEx employees everywhere!

Fred asks the reader to assume two completely outlandish things here! First, he asks the reader to believe that FedEx employees would be dumb enough to vote for a union that would place such demands on us and secondly, he asks the reader to assume the unions would be dumb enough to ask us to sign on to such an outrageous arrangement!

Whatever union and contract we wind up with, at a strength of 100,000 employees, bringing, by Fred’s own estimate, some 27 million bucks to the union that organizes us, one thing is crystal clear. It will be our union and our contract! It will be done our way and we will not take a back seat in the process! FedEx is a unique company whose employees have unique problems and who work under unique circumstances. No union is going to waste the time and resources it will take to eventually organize us unless they are certain they’ll be able to offer us a contract we all can vote for. Whether this means that our pension fund will wind up centrally managed by the main union office or whether reciprocal agreements are entered into by the various locals serving FedEx employees nationwide, we are not going to lose our benefits! If any manager dares to imply this, just look him or her in the eye and ask; "Just how stupid do you think I am boss?"

In the section of his memo entitled "Closing Thoughts," Fred states that "FedEx is not anti-union." He even underlines this point to give it added emphasis. Yet, everyone working at FedEx who has kept their eyes and ears open during their employment knows this is a lie of absurd proportions! Even back in 1986, when I first came to work for the company, managers routinely parroted the phrase that "Fred says he would padlock the place and walk away if employees ever chose to unionize!" Of course, none of us ever heard Fred say this in person, but the sentiment was so often spoken by managers in one permutation or another that its basis had to be rooted in truth. We also have recently witnessed the furious eleventh hour lobbying by Fred and FedEx's political action operatives that resulted in Congress extending its session to vote on the FAA Reauthorization Act revision to put those magic words "express carrier" back into the legislation so FedEx could remain under the protective umbrella of the RLA! Understand that there was no other reason for FedEx to lobby so hard for that revision in the FAA legislation than to make it as difficult as possible for FedEx employees to unionize! This is clear evidence that FedEx is indeed anti-union!

Finally, Fred gets around to explaining his earlier indictment that the Teamsters and UPS management are in bed together to organize FedEx employees. He states:

"This is why they (UPS) have been willing to allow their employees, while on the clock, to approach our employees."

Yet what Fred sees as a conspiracy between the otherwise adversarial UPS management and the Teamsters is hardly that! Instead, it is an effort which Ron Carey himself formulated and called the "Every Member An Organizer" program which I mentioned in my March update. Under this program, Carey calls on all Teamster members to approach workers they have daily contacts with who are not protected by unions and may be seeking that representation. In other words, when UPS employees approach us to help in our organizing efforts, it's simply the Teamster's version of "Finders Keepers" without the financial incentives!

Even so, you might ask why a UPS employee, or any other Teamster employee might want to help us organize, Carey's program notwithstanding. The answer is simple. So long as FedEx remains non-union, UPS management, and indeed, the rest of the LTL (less than truckload) freight industry covered under the National Master Freight Agreement can point to FedEx during contract negotiations and say something to the effect; "Why should we give you a raise when FedEx employees are only making X dollars an hour!?" or "Why should we give you that benefit when FedEx employees don't have it!?" In other words, it is in UPS management's best interest that FedEx remain non-union because our substandard wages and benefits can be used by UPS negotiators as a lever to keep union contract demands down! Kinda blows a huge hole in Fred's conspiracy theory, doesn't it!?

Further on in this paragraph of the memo Fred states;

"If our operations are hampered by strikes and walk-outs, if our employees become focused on internal labor relations issues and stop focusing on the customer, if our service quality erodes for any reason, UPS will reap the rewards."

At this point, it becomes sadly evident that Fred has become dangerously out of touch with the realities that already exist within his company! He has already allowed his employees to become not only "focused," but downright obsessed with "internal labor relations problems!" People fearful of their job security because their coworkers are being terminated for outrageous reasons become far more than "focused" on "internal labor relations problems!" People being hounded by management about productivity numbers, handed daily highlighted computer printouts of their performance and being asked to sign incriminating and intimidating document after document are going to find it difficult to be "focused" on anything but "internal labor relations problems!" And as the "Barney Fife" article I did in the March update clearly evidences, our "service quality" is already eroding, not just at the hourly employee level, but at lower salaried employee levels as well! FedEx has a morale problem of monumental proportions which has been fomented by rampant "internal labor relations problems!" Fred clearly needs to get out of Washington and Memphis more often....

My own closing thoughts are that Fred obviously remains either deliberately or passively ignorant of the needs and realities of his employees and has demonstrated a willingness to exaggerate, distort and state outright lies to keep unions at bay! Whether by deliberate design or inexcusable ignorance, he has done all of the following. He paints conspiracy theories where a case can be clearly made for precisely the inverse of what he claims to be true. He sees impending ruin and financial disaster for unions with billions of dollars in resources at their disposal! He finds significance in the demise of 27 trucking companies over decades while ignoring the competitive business realities of America where thousands upon thousands of companies have gone out of business in that same period! He claims SFA is responsive even in the face of SFA results being more and more abysmal with each passing year! He insults our intelligence by stating that FedEx is not anti-union while spending millions of dollars of the company's (our company's) money on lobbying efforts and ferrying members of Congress around on our four corporate jets specifically to make organizing for FedEx workers as difficult as possible! He uses exactly the same argument to stir up fear of UPS as the omnipotent wolf at our doorstep as UPS managers used over two decades ago at contract time using the United States Post Office as their bogeyman! He has said that unions might be responsible for bringing an erosion to our service that will drive away customers when it is he and his management of this company that are doing precisely the same thing NOW! He has cited the swiftness of the GFT process as some sort of godsend while seemingly oblivious to the fact that it is anything but that to the men and women who routinely lose their jobs daily at FedEx! He has portrayed making money as something dirty when people protecting workers' rights do so but seems to have no objection to wallowing in that same filthy lucre himself when it comes from the sweat of our collective brows!

He has done all this and much more in the seven pages he issued on March 3rd. But perhaps the most telling thing of all about those seven pages is that they were targeted at FedEx managers. If Fred is willing to lay such a poison-laden feast out for his own managers, imagine what he's been dishing out to us and what is in store for us in the future....