I'm not in a position to state categorically that Fred's August 25th FCEO (From The Chief Executive Officer) was his biggest imperial edict to date, but I think it would be a very safe bet to say that at 8 pages in length, it has to be in the top 10 in the history of the publication! Maybe some manager out there who's been around long enough might verify my suspicions (your anonymity, as always, is assured). In any case, as your managers likely wallpapered your station with copies of it, most of you have had the opportunity, if not the actual intestinal fortitude, to peruse this monumental effort on the part of our beloved leader to teach is what he euphemistically titled "The UPS Strike: Lessons Learned...and Re-Learned!" Whether you did or didn't wade through this lengthy piece of reeducational material is unimportant. However, that we all examine it through the magnification of the lens of truth, in my humble opinion, is important. For in doing so, we can again chronicle Fred's, and de facto, FedEx management's continuing assault on, and insults to our collective intelligence!
Before we get into the analysis of this issue of FCEO, note that I used the term "reeducational" to characterize this edition of Fred's newsletter. I chose that term carefully and deliberately. Those of you who might be familiar with contemporary world history will recall that the Communists of the old Soviet regime packed intellectuals and dissidents off to places they used to call "reeducation" centers where they were constantly subjected to barrages of Communist propaganda until their wills were broken and they begged to be forgiven for their sins against their Red comrades. Once their Communist keepers were convinced that a "student" had truly repented and now saw the error of his or her ways, the "student" was then either assigned some menial labor job in the grist mills of the Communist "utopia" or was graduated from the "reeducation" camp with a bullet to the back of the head!
The reason I mentioned this little piece of historical fact is that I believe a very valid parallel can be drawn between the tactics of the old Commies and those of our management team at FedEx. For if one is indeed gullible enough to believe what our corporate "educators" tell us and slobber gratefully over the paltry nickels and dimes they've been doling out to us lately in pacification raises, then the reward we will likely reap for our acquiescence and gratitude will be not unlike those the intellectuals and dissidents received from their Communist "educators." We'll either wind up as forgotten cogs in the corporate machine or we'll receive a figurative bullet in the back of the head in the form of a termination letter...
Rather than teaching us anything in this first section of this edition of FCEO, Fred merely uses the quoted heading as a lead-in to gush about how wonderfully we all performed our jobs and how well we served our loyal customers. The only real item of significance in Fred's opening page of FCEO 8/25/97 was when he stated that we "served the country well given our overall capabilities to handle additional volumes."
The significance of the above quote is that it was a very subtle and clever way in which Fred could further entrench and/or reinforce the notion that FedEx is tied to the country's very welfare in a manner similar to the Armed Forces. After all, the notion of service to one's country is generally reserved for those in public office or serving in the Armed Forces. The only reason anyone would characterize the conducting of a business enterprise as performing a service to the nation is if the person making such an analogy wants to create the impression that the business in question indeed has some special relationship to the nation's well being. Fred created and has continually nurtured this impression, however trumped up it is, ever since he founded FedEx in order to get and keep FedEx employees under the protective umbrella of the Railway Labor Act. As I contemplated Fred's almost subliminal inclusion of the "served the country well" phrase in FCEO 8/25/97, it dawned on me that I had never considered Fred's choice of Federal Express as the name of his fledgling company before in a scrutinizing manner. However, now that think about it, I can't help but believe that Fred's desire to link the company from the very beginning to the government was more than a simple marketing gimmick...
Fred starts off this "lesson" with yet another of his many bald-faced lies! He states that in the aftermath of a work stoppage, "Union leaders declare victory in virtually every case." Yet, in my 46 years on this planet, I have read many news accounts where union leaders of many different unions have matter-of-factly conceded to employer demands and have expressed their support for compromise agreements that have ended strikes. Fred obviously pulled this statement straight out of his rectal orifice with total contempt for the actual labor history of this nation! But then again, this isn't surprising because Fred has repeatedly demonstrated his contempt for the facts where unions are concerned by many of his past statements he's foolishly committed to print form.
The lesson continues with Fred mentioning that FedEx and other competitors of UPS reaped the only benefits of the strike while bemoaning the plight of UPS's customers whom he called the "biggest losers of all" because they were subjected to anxiety, inconvenience, and financial losses. In the next breath, Fred sheds crocodile tears for UPS management whom he says lost $600 million and suffered "likely damage to their employee relationships, their customer relationships and their reputation".
Notice anything strange about this part of "lesson" #2 yet? Doesn't it ring a bit disingenuous when a business leader who had just reaped windfall profits for his company as a result of a strike against his most formidable competitor expresses sympathy for that competitor's plight? Is this a case of classic schizophrenia or a display of enormously transparent self-serving hypocrisy! Take your pick....
Another notable characteristic of this part of Fred's "lesson" is the complete absence of any mention of UPS management's culpability in all the aforementioned woes Fred recited so somberly. Never forget that it was the blowhards in UPS management who so arrogantly shoved what it termed its "best and final offer" at both its employees and at the media with a loudly proclaimed take-it-or-leave-it attitude! Confronted with that kind of pompous inflexibility, the union was left with two choices. Either give the company everything it demanded and be rendered utterly powerless and obsolete as an organization or fight. In other words, UPS management gave the Teamsters the choice of either committing what amounted to nothing short of institutional suicide or leading its members out on strike. That, boys and girls, is no choice at all! UPS management, by initially slamming the door on possible negotiations with the union with its "best and final offer" ploy made a strike absolutely unavoidable by any reasonable definition! Fred didn't include this fact in his "lesson" though because even though UPS is our biggest competitor and threat, Fred has crawled under the covers with his management cousins at Big Brown to engage in a bit of self-serving incest designed solely to shroud the facts in a veil of smoke. It seems that business indeed makes strange bedfellows...
In the next part of Fred's "lesson" #2, he asks the uproariously hilarious question "Did UPS employees win?" Again, more than a month after the strike's end, with plenty of time for analysis, the overwhelming majority of pundits from virtually every form of the media have categorized the outcome of the strike as an unquestionably enormous victory not just for UPS's rank and file, but for American workers as a whole! But don't take my word for it. See for yourself by searching the web for articles on the strike. Here's just a few blurbs from articles I've grabbed as I followed the strike news.
"Teamsters Union president Ron Carey won a huge battle for organized labor last week when he arm wrestled UPS into settling a strike." - Bruce Van Voorst - Time Magazine
"A big victory for labor" - Josh Dubow - ABC News
"The agreement announced in the wee hours yesterday ending the Teamsters' two-week strike against UPS is a clear victory for the union, providing higher wages, bolstering the fortunes of many part-time workers, and maintaining the pension fund just the way the union wanted it." - Daniel DeLuc - Philadelphia Inquirer
"I think years from now people may look back and say this was the beginning of the turnaround for labor." - John Schmitt - economist at the Economic Policy Institute
"This was a high-visibility confrontation in which the union basically got what it wanted." - Steve Babson, labor professor, Wayne State University in Detroit
Like I said, these are just a few snippets from particular articles I've saved because of their relevant content. If you do some serious surfing on the net, you could easily come up with literally hundreds more such quotes that leave no doubt as to who the real winners in the UPS strike were. Sure UPS's competitors made gains as a result of the strike, and as A FedEx employee, I fervently hope we manage to hold on to as much of that business as we can. However, the actual effect on presently-employed UPS workers will, in my opinion, be absolutely negligible! About the only effects the strike might have on UPS's rank and file will be that UPS will simply hire fewer people this year than they normally would have. That's bad news for people on the waiting lists for employment at UPS, but it hardly bodes ill for those currently wearing the brown uniforms. Furthermore, with peak season approaching, the slight decrease in package volume UPS experienced due to the strike might prove to be a welcome relief to employees who often endure 12 hour work days during the holiday season. In short, to again quote Shakespeare, despite Fred's feigned concern over the fate of UPS workers in the aftermath of the strike, the most likely outcome will be that Fred has made "much ado about nothing."
In next paragraph of Fred's "lesson" #2, he tells us that UPS management has historically extracted some very important concessions at the bargaining table during contract negotiations. He uses the example that the unions have continually agreed to lower wages for part time and express workers at UPS. Yet, by saying that, Fred is telling yet another half-truth which is carefully designed to create a false impression among uninitiated FedEx workers. The entire truth is that the only pay differences between part-time and full-time employees at UPS exists solely in the job classification of their express drivers.
Fred then says something absolutely amazing when he states; "That's how this year's "part-time issue" became an issue in the first place." When I read this section of Fred's "lesson" my head almost exploded while I attempted to make sense of the incredibly convoluted thinking that Fred must have been engaging in when he wrote that! In one sentence, Fred's touting the fact that UPS management has been adept at keeping an economic foot on the throats of its part-time work force and then, in the very next sentence, he openly admits that this was one of the key reasons that the union finally stood up and said "enough is enough!" In other words, Fred, though he had no intention of doing so, admitted that management at UPS had pushed the envelope of its workers and their union representatives tolerance levels to their very limits before all hell finally broke loose! So while Fred would be loathe to consciously admit it, he inadvertently has stated in his very own propaganda publication that it was indeed UPS management's own bargaining strategy that precipitated one of the key reasons for the strike!
Next up in "lesson #2, Fred laments that it will take the average full-time package car driver 15 months to recoup the lost wages he or she endured as a result of the strike. Although I've said it before in other articles, I find it necessary to repeat the fact that Fred, like so many of his managers and his propaganda spinmeisters, simply doesn't understand that there are more important things in life than the almighty dollar! The fact that UPS workers secured not only regularly scheduled wage increases in this contract that will (unlike those of us working for FedEx), keep them ahead of cost of living increases, but also forced UPS to limit subcontracting to peak season and only with union approval (UPS wanted to increase subcontracting), retained the status quo for the "innocent until proven guilty" categories of infractions (UPS wanted to expand the so-called "cardinal sins" category to include other worker infractions) and obtained concessions that enhanced part-time workers' chances of getting full-time positions makes the monetary setbacks UPS workers endured pale into insignificance compared to the gains they made in their dignity as workers!
Fred then proceeds to grudgingly concede that UPS part-time employees would receive "meaningful pay increases" but quickly points out that they will continue to remain at lower levels of pay than UPS full-time employees. He also doesn't hesitate to add that part-time employees at UPS "had not received wage rate increases in several years." It would seem that Fred has a problem with exploitation of part-time workers everywhere. Everywhere, that is, except within his own beloved FedEx! You see, Fred is playing a little sleight-of-hand with the facts here in order to make it appear that part-time employees at FedEx are much better off than their unionized cousins at UPS. And while it's true that UPS part-time express drivers are paid a lower rate than the full-time express drivers and both are paid at a lower rate than UPS package car drivers, what Fred conveniently omits is the fact that the lines of demarcation between jobs at UPS are clear and that express drivers at UPS do a job that's decidedly easier than their better-paid package car driving coworkers, or, for that matter, FedEx couriers!
FedEx people know this to be a fact because we've all seen UPS express drivers walking around on our routes with small clusters of envelopes or a few small boxes tucked under their arms as we're dragging our four-wheelers full of P1 freight behind us! In all the elbow-rubbing I've done with UPS employees over the years on the various routes I've had, the most I've ever seen a UPS express driver toting is a two-wheeler with a small stack of boxes and envelopes filling about one-third of the capacity of the hand truck! In other words, the UPS air driver of today is doing about the same work FedEx couriers used to do 15 or more years ago when two-wheelers and Econolines were the norm! Furthermore, wages have always been determined by work classifications at UPS and there's nothing at all unfair about the system. I recall that when I started at UPS I was classified as a loader and I received a lower rate of pay than the puller who took packages off of the slide and placed them in the truck I was loading. He got more pay because he was required to know the appropriate zip codes of the parcels that went into the truck I was loading. Likewise, the sorters on the other end of the building got more pay than the pullers because they had to know the entire sort scheme for the whole hub. Wages at UPS have always been determined by differences in job requirements and there's absolutely nothing unfair about that. However, as you'll read later, Fred has an ulterior motive in highlighting the pay differences at UPS...
The reports of statements by UPS management that business lost during the strike could result in as many as 15,000 of its workers being laid off was next on Fred's laundry list of the horrors that resulted from the strike. In the month and a half since Fred published his parroting of UPS management's forecast of gloom, no such layoffs at UPS have materialized. It would appear that as Teamster President Ron Carey said of those "reports" at the time UPS management issued them, that they were indeed nothing more than "scare tactics" blurted out by UPS management that was still reeling after the butt-kicking they had just received courtesy of the Teamsters!
Get ready folks, because in the next part of Fred's "lesson" #2 he really starts to come unglued and begins making statements that are downright ignorant! He starts his journey into the far reaches of fantasy by stating that since UPS agreed to create 10,000 new full-time jobs by combining 20,000 existing part-time jobs that this will "result in a reduction of around 10,000 total jobs - jobs that currently have real people attached to them." Aside from the irony that here we have Fred Smith, a man that employs thousands "real people" who fully realize that they are little more than grist for his ambitions, oozing compassion for "real people" holding jobs at our fiercest competitor, we also have to deal with the scary notion that Fred is able to suspend time in his thought processes so that he can construct a business scenario that exists in a virtual vacuum! For only in a place suspended in time can one envision a UPS juggernaut that doesn't create 2,000 new part-time jobs out of a work force of over 185,000 through natural attrition alone! Unlike FedEx, UPS is a very old company which has been around since 1907. Workers at UPS actually do something that we rarely ever hear of anyone successfully doing at FedEx... They retire! So out of a work force of 185,000 employees, one might imagine that at least 1% of the work force reaches retirement annually without fear of being unreasonable in making such a speculation. That means that if just 1% of UPS's rank and file of 185,000 workers retires annually, those 2,000 new part-time jobs necessary to make up for the annual consolidation required to create the 10,000 new full-time positions over the five year span of the contract can be effortlessly created without a single existing job at UPS being threatened! Of course, the annual attrition rate at UPS is likely far higher than 2,000 part-time jobs anyway when you add terminations and people simply moving on to other jobs of their own volition. So, even remotely alluding that this contract agreement jeopardizes existing jobs at UPS was utterly ludicrous on Fred's part! But Fred suspended more than attrition of employees when he dreamt up this part of his "lesson." He also suspended all economic growth that would naturally result in the expansion of the work force at UPS as well. Like I said, Fred created a business scenario in his mind that had to exist in a virtual vacuum in order for his forecast of threatened jobs at UPS to be valid. Be afraid! Be very, very afraid....!
Now comes the inevitable part in every piece of FedEx propaganda where either Fred or one of his spinmeisters performs that now tired and all-too-familiar magic trick I would now like to officially dub the "watch me pull a number out of my butt" trick! In this permutation of the trick, Fred tells us that "FedEx - with only 85,000 U.S. hourly employees - has promoted over 20,000 total part-time employees to full-time jobs over the last 4 years!" This from a man who just a scant paragraph earlier created a business scenario in the Twilight Zone..... Of course we believe his numbers, don't we? After all, they came from the illustrious independent auditing firm of Slipp, Skipp and Tripp Associates!
But wait a minute! Maybe I'm being too hasty in my sarcasm of Fred and his magic numbers! After all, at the rate at which FedEx has fired seniority employees, perhaps it is plausible that the company promoted nearly a quarter of its entire work force to full-time in the past 4 years just to make up for all the terminations.... I just spoke to Al Ferrier the other day and he told me that out of the 112 workers he started with some 12 years ago at his station, only 7 of that original crew are still there! Sure some of them probably transferred to other stations and others left FedEx voluntarily, but 7 out of 112 is a sobering statistic that no reasonable number of transfers and resignations can justify.
Fred then tackles the union pension fund issue and predictably cites the fact that at times the fund has been underfunded as well as resuscitating the union bogeyman by mentioning the union's record of pension fund "improprieties." Then Fred makes a colossal blunder by comparing the union's pension fund to FedEx's! As evidence, he cites a report produced by Alan Graf, FedEx's CFO (chief financial officer) done in January of 1997. This part of Fred's "lesson" is so good that I just have to savor it in small bites!
STATEMENT #1
"we have one of the most soundly funded and best pension plans to be found anywhere."
TRANSLATION
we've fired so many seniority employees that hardly anyone has put in enough years
to accrue benefits or stay employed with us long enough to reach retirement age!
STATEMENT #2
"Most notably, our pension plan is not burdened with the potential of paying
benefits to employees of other, less successful companies whose pension plans may
have severe funding deficiencies."
TRANSLATION
"Most notably, our pension plan is not burdened with the potential of paying
benefits to employees"
STATEMENT #3
"And, in addition to the pension plan, FedEx employees also have a Profit Sharing
Plan and a Retirement Savings Plan, which offers matching funds for a portion of
the amount saved by the employee."
TRANSLATION
"And, in addition to the pension plan, FedEx employees also have a Profit Sharing
Plan and a Retirement Savings Plan," neither of which most employees can afford to
take advantage of after having their wages frozen for so many years without raises
and constantly losing ground to annual cost-of-living increases!
STATEMENT #4
"All of these programs combine to provide excellent retirement benefits for our
employees, along with the priceless peace-of-mind that comes from the knowledge
that the plans are secure, professionally managed, and not only fully-funded, but
significantly overfunded."
TRANSLATION
"All of these programs combine to provide excellent retirement benefits for our
employees" It's a damn shame that most can't afford to participate in two-thirds of
these programs and that the remaining program gives a full-time FedEx employee just
about the same retirement benefit as a UPS part-time retiree will get. Of course
that assumes that a FedEx employee will last long enough on the job to actually
collect any benefits....
Fred wraps up "lesson" #2 by quoting UPS's CEO who commented that he believed the strike was an "unnecessary" disruption of their service and to their employees' lives. Fred expressed his agreement with that opinion of UPS's head honcho. It's probably surprising to you that I too agree with UPS's CEO on that point. However, when Fred went on to state that he thought the strike had more to do with the union's "internal political situation than with the actions of UPS management or the interests of UPS employees," he and I part company. If the knuckleheads in UPS management hadn't initially been so arrogant and intransigent in presenting that "best and final offer" to the union while waving it all over the media and burning their bridges behind them in doing so, perhaps the whole unfortunate confrontation could have been avoided.
In this "lesson," Professor Fred draws distinctions between the nature and size of the parcel post and express package markets. The purpose of this "lesson" is simple, yet Fred does a discreet tap dance around his real intent instead of coming right out and stating it. The closest he comes is in the following three excerpts.
"That's very important for our employees to understand in comparing FedEx to UPS in
any category."
"during the disruption, most of the truly important shipments continued to be
handled by us, and to a lesser degree by Airborne and Express Mail."
"Fortunately, for American business, the parcel post market is composed, in
general, of much less critical shipments."
Fred cleverly camouflages his real intentions in this "lesson" by making a couple of painfully obvious points. He tells us that he expects that the segment of UPS customers who use UPS for their express packages are more likely to "re-evaluate their situation" as a result of being left stranded by the strike while he expects most shippers who use UPS for their parcel post shipments to return to UPS. Gee! Ya really thinks so Fred? Golly! We would have never figured that out on our own! But then again, you know how dumb we all are, huh Fred?
Obviously, Fred didn't waste an entire page, complete with pie charts, to tell us all something we already knew. His real intent was to reinforce the notion in our minds that because we handle the majority of the "express" market packages while UPS handles the majority of the "parcel post" market packages, "American business" dodged a bullet during the strike because FedEx, the major player in the express delivery market, was still on the job. Fred could have saved a lot of ink if he had just come out and said something like;
"It's a good thing for the American economy that FedEx employees are hamstrung by the archaic Railway Labor Act from easily organizing themselves under a union! For if it had been FedEx who had gone out on strike, brokers would have been jumping out of windows and splattering on the pavement of Wall Street like so many raindrops!"
Like the befuddled old Senator Fritz Hollings, Fred cannot see beyond the piles of packages to consider the people who move those packages. Instead, his gaze is intently fixed upon drawing distinctions in market types and retaining his tenacious grip on that piece of antiquated legislation called the RLA. But history betrays Fred and sweeps away the cloud of smoke he's cloaked his true intentions in with all his hollow rhetoric about market distinctions. Fred would like us to all forget the fact that long before FedEx became a company of any consequence, he had already greased the wheels in Washington and got the company wrapped in the protective blanket of the RLA! That just goes to show you that a rich kid can go to our nation's Capitol, grease the right political hacks and wind up with the U.S. Seventh Fleet as an escort for his rubber dinghy!
Fred's scared to death by the outcome of the UPS strike! For that matter, so are fat cats in board rooms all across America! Workers in all types of industries were awakened and emboldened by the Teamster victory and unions are finally breaking out of their traditional molds and are beginning to focus in earnest on workers in the preeminent service sectors of our economy. To make matters worse, with FedEx's acquisition of Caliber Systems and its subsidiary RPS, the shirts over at UPS are now making noises about challenging FedEx's protection under the RLA since Fred has decisively plunged into the "parcel post" market in earnest!
Of course, Fred's no dummy. He's already announced that RPS will be run as a completely separate company offering a strictly parcel post type service. However, Fred might find that such a ploy could be too transparent, even for the phonies in Washington when it's pointed out that he's using the same FedEx sales force to peddle the RPS parcel post service. After all, the boyzz over at UPS are no dummies either.
Actually, Fred's "lesson" #4 is simply a continuation of his previous "lesson." Only in this chapter, Fred again crawls into that incestuous love nest with his cousins in UPS management by justifying their different pay scales for their express drivers as opposed to their package car drivers. Fred talks about the tight loop routes of UPS package car drivers and their concentrated package volumes as being highly efficient while express routes are more expansive, less dense insofar as package volume is concerned and are therefore not as efficient. Fred also mentions the obvious differences between time-definite deliveries and the information systems required to track them as opposed to parcel post type deliveries that have no specified delivery commitments or tracking requirements. He uses these differences to sell us the notion that UPS had to form what he characterizes as a separate express company within a parcel post company in order to effectively compete with us while paying that express company's employees significantly lower wages.
I believe Fred had a dual intent in this "lesson." Predictably, as in all his other lectures, the good professor opts to tiptoe around his real intent without actually coming out and saying what's on his mind. Instead, he uses the company within a company scenario to not so subtly justify UPS paying its express drivers lower wages and in doing so, he de facto creates a justification for keeping our wages far below those of UPS package car drivers. I also believe that Fred created this company within a company scenario with an eye toward a possible challenge of FedEx's RLA status as a result of the real lessons we learned from the UPS strike. Fred may intend to try and fend off a challenge of the RLA by trying to suggest that UPS has somehow hidden a separate corporate entity within itself that should be included under the RLA rather than having FedEx removed from under its jurisdiction. In other words, the best defense is often a good offense...
Fortunately, we FedEx people aren't nearly as blinded by Fred's smoke screen as he'd like to believe we are. It's no secret to us that FedEx couriers do far more labor intensive work than our cousins in the express segment of UPS. As I've already mentioned, I often see UPS express drivers on my route and I'm always more than a little envious as they whisk by me with an armful of small bundles as I'm struggling like a mule to pull my four-wheeler stacked well over my head with packages up an access ramp into the same building! And while here in Chicago I may be getting paid a little more than a UPS express driver, it's important to note that this is not at all true in other markets across the country.
A week ago, I participated in a national conference call with selected FedEx Teamster organizers and a roll call of wages and benefits was part of the call. The results clearly demonstrate just how opportunistic and all over the map FedEx wages are as you move from region to region and even station to station within our company. For example, the lowest courier wage reported during the call was $10.68/hr! Handler wages were reported as low as $6.96 an hour! At the same time, it's important for FedExers to understand that UPS's wage structure is much more rigid than ours across the board! There are regional differences in UPS's pay scales, but those differences are nowhere near as wide as those found throughout FedEx!
I'll give you a real life example of what I'm talking about. One of my closest friends is a fellow I met in Vietnam. He lives in a flyspeck of a town in north central Massachusetts. For those of you familiar with rural New England (the real God's country!) you'll know that brick homes are as scarce as hens teeth in that area of the country. They are also extremely expensive! The first time I visited my old buddy, we were tooling through the countryside and there, amongst all of the unfinished clapboard-sided frame homes was a beautiful sprawling brick ranch style house that looked as though it had been plucked out of one of Chicago's affluent suburbs and dropped into this unlikely New England setting! I immediately asked my friend something like; "What big shot lives there?" He casually replied; "Oh, that's where our UPS driver lives."
If Fred had left just two small parts out of this "lesson" he would have left me without any rebuttal to it at all. This "lesson" was primarily dedicated to showcasing what I believe is one of the best features about working for FedEx, namely our Career Opportunities Policy. Even though I'll likely never make use of it, I think it's wonderful that FedEx allows its employees to bid on jobs anywhere in our system! This policy enabled my best friend to move to California and escape the cold winters he bitterly hated here in Chicago. I've seen many coworkers throughout the years transfer to places they always dreamed of living in and I've seen the policy enable fragmented families to again be reunited!
Sadly, Fred had to pollute this otherwise sensible section of his mini-novel by playing fast and loose with the facts concerning part-time wages at FedEx and the rate at which part-time employees are promoted to full-time. While it is true that part-time workers at any given FedEx station have the same top-of-scale wage potential as full-time workers in the same job classification, Fred conveniently omits that it typically takes a new employee at FedEx around 6 to 7 years to finally arrive at that top wage! He further omits that fact that the speed at which one reaches top scale varies as wildly as FedEx wages across the country do! Ever since wage increases were tied to performance reviews, the time it takes a typical employee to finally hit top scale has increased dramatically. When I was hired, if memory serves me correctly, I reached top scale slightly earlier than I reached full-time status and it took me somewhere around 21 months to get full time. At today's FedEx, reaching top scale OR full-time status is a pipe dream in anything less than half a decade at best! And if, as a FedEx manager told me, 6 - 7 years is "typical" for new employees to now reach top scale, imagine how many employees within the system take even longer to reach it in order for 6 - 7 years to be "typical!"
I would be remiss if I didn't also point out that most all new employees at FedEx are now hired as cargo handlers which places them at an even lower starting wage than courier entry level wages and it's not at all uncommon for handlers to remain in that classification for years even though they are regularly used to run routes and perform courier work! At UPS, on the other hand, everything related to wages is carved in stone and set at a specified pace. Top scale wages in all classifications at UPS are reached quickly, predictably and the whim of one's manager has no influence upon the speed at which a UPS employee reaches top scale. FedEx's wages used to be structured in exactly the same way but our management trashed that system years ago. There was nothing "people first" about that change in policy either. It was of absolutely no benefit to any FedEx hourly employee that structured wage increases were done away with! This was a policy change that was solely aimed at maximizing the exploitation and control of hourly workers at FedEx!
Fred continues this "lesson" by adding that on top of our wages, FedEx employees also have the opportunity to pick up some extra money by participating in various incentive pay programs. Yet, even these incentive programs are inherently unfair in nature because FedEx employees are largely not in control of situations that affect their ability to participate in them fairly across the country! As evidenced by the recent removal of sales leads as a requirement in the performance review, many FedEx employees with residential and rural routes are at a huge disadvantage over their peers with commercial and industrial routes where participation in "Finders Keepers" is concerned. Performance reviews are unfair because all sorts of extraneous nonsense is injected into their compilation such as personality differences, managerial styles and even an employees level of ability to discuss issues in the review logically and persuasively with his or her manager. BPP is perceived by most FedExers as a pure crap shoot where awards are routinely won or lost based upon circumstances completely beyond the control of the hourly employees! To put it bluntly, FedEx's so-called incentive pay programs are anything but consistent or fair where participation in them is concerned!
The last page of Fred's "lesson" extravaganza he has the brass to state that "our merit-eligible hourly employees continue to receive merit base pay increases averaging 5.1% annually. These annual base pay increases exceed those reportedly reportedly agreed upon for UPS full-time employees in their tentative agreement." I really would like to believe that by now, everyone visiting this site knows the game Fred is playing with the figures he cites. However, in case you are new to this web site and aren't familiar with FedEx management's tactics where talking about wages and raises are concerned, I'll rehash it all again for your benefit.
Fred and his management cronies never talk plainly about wages. You'll never see a FedEx prepared chart comparing top-of-scale wages at FedEx to those at UPS. The only place you'll ever even hear, read or see those kinds of truthfully accurate comparisons is on this site, on the other FedEx employee-run web sites and at union halls! Comparing top of scale wages is as horrible a thought to Fred and the boyzz as a garland of garlic would be to Count Dracula. Instead, Fred loves to talk about wages and raises in terms of "merit base pay increases." You see, "merit base pay" is any of the various pay rates hourly employees are incremented through between the time they're hired and the time they reach top-of-scale pay. So when Fred talks about "raises," what he's really talking about is the amount of incremental increases non-seniority employees experienced in their base pay as they move through the pay range from entry-level pay to top-of-scale pay! To FedEx management, this is defined as a "raise." To anyone else in the real world, this would be called a pay increment between top and bottom wage scales. A true raise is either a genuine increase in top or entry level wages. What UPS workers got in their contract were genuine raises. What Fred's producing when he mentions "merit base pay increases" is pure smoke!
Of course, most FedEx seniority hourly employees have received genuine raises this past year. First we received the 3% union damage control raise that was announced 5 months in advance and we just recently received another 2% union pacification raise. The strike was barely over before Fred and the boyzz quickly announced yet another 2% raise scheduled for early next year as well as promises for widespread market level increases across the entire system! It would seem that happy days are here again! At least that's what Fred and the boyzz are fervently hoping you'll believe. For you see, Fred knows something enormous is heading his way! The unions are recharged, their confidence levels are at an all-time high, public opinion is clearly on their side and they're turning their gaze inexorably toward Memphis! Now that the NLRB has ruled that we must go the way of the RLA, the unions are no longer embroiled and encumbered by wading through the courts or waiting for government board decisions. They now know what needs to be done, and they are putting together their final strategies as you read this.
Finally, Fred makes a statement in this edition of FCEO 8/25/97 that, in light of our recent acquisition of Caliber Systems, rings hollow where honesty is concerned. Fred stated; "Our strategy of focusing solely on the express markets - from FedEx Same Day to FedEx Express Saver and the various service options in between - is the best long term strategy for all our futures." Obviously Fred didn't mean what he said just a scant month or so ago when he wrote this because FedEx, having acquired RPS, is now indeed splitting it's focus and casting hungry eyes upon some of UPS's parcel post volume....
The value of this edition of FCEO was not in the "lessons" Fred intended to teach us. Instead, the value of the document lies in what we've learned about Fred as a person, and consequently, what we learned about the the way we can expect our management to interpret the outcome of the UPS strike. It is evident that we can expect nothing in the way of candor about the issues raised by the strike from our leadership. We can only expect the usual corporate spin that paints the unions as bad guys and management as the wronged and injured parties. In a way, we should be glad that Fred chose to play with numbers, tell half-truths and manufacture fantasy business scenarios rather than deal with the real lessons of the UPS strike forthrightly. His choice of strategies will only serve to further alienate FedEx employees from our corporate leadership and will make it easier for workers to see the raises, bonuses, newspaper ads, buttons, post-it note pads and all the other little gimmicks and small change management has been throwing at us lately for what they really are. Namely trinkets designed to lull the natives into contentment until they no longer pose a threat to the status quo.