FedEx Express pilots reject tentative labor agreement

Earlier this week, pilots at Memphis-based global freight transportation services provider FedEx subsidiary FedEx Express rejected a tentative agreement with FedEx, according to the Air Line Pilots Association (ALPA).

ALPA said that the pilots rejected the deal by a 57% to 43% margin. And as for next steps, it added that it expects the National Mediation Board to convene a status conference with the pilots and FedEx, with the caveat that there is no time requirement for this to occur.

“Our members have spoken and we will now regroup and prepare for the next steps. In the coming weeks, the FedEx ALPA leadership will meet to establish a timeline for assessing pilot group priorities moving forward. FedEx pilots remain unified and that will drive a new path that will help produce an agreement that all FedEx pilots will be proud to support,” said Capt. Chris Norman, FedEx ALPA chair, in a statement.

This development follows a tentative agreement made by the parties in late May. Details regarding the terms of the agreement were not made publicly available by the parties at the time.

FedEx said in a prepared statement that the tentative agreement voting results have no impact on its service as it continues delivering for its customers around the world.

“The parties will return to negotiations under the supervision of the National Mediation Board,” it said. “While we are disappointed in these voting results, FedEx will continue to bargain in good faith with our pilots to achieve an agreement that is fair for all FedEx stakeholders.”

As previously reported by LM, FedEx pilots for the company’s FedEx Express subsidiary represented by the Air Line Pilots Association (ALPA) said in mid-June they voted to approve the contract, with a membership ratification ballot scheduled for July 5, which was set to close on July 24.

When the tentative agreement was announced on May 30, contract details were not disclosed. But terms were made public by ALPA last month, including:

• a 30% pay increase;
• a 30% increase to the pilots’ legacy pension; and
• a fully-developed and company-funded Market Cash Balance pension to provide a durable replacement for their legacy pension
• ALPA officials said that this is the largest investment in a pilot contract, to date, on a per-capita basis and also substantially raises the bar on pilot retirement.

ALPA officials said that ALPA and FedEx management had been in mediation with the National Mediation Board going back to November 2022 (the contract became amendable in November 2021), with negotiations for a new deal having begun in May 2021. And they added that the FedEx pilots are currently working under contractual provisions and benefits that were negotiated in 2015.

On May 17, FedEx pilots, represented by ALPA, voted to authorize a strike, if needed, in order to come to terms on a new contract.

At the time Norman explained that FedEx needs to deliver a new contract that reflects the value the ALPA pilots bring to FedEx as highly skilled professionals delivering FedEx’s “Purple Promise” on a daily basis.

In a collective bargaining update issued by FedEx on the same day, the company said that FedEx remains focused on providing world class service to its customers, adding that while strike authorization votes are a common tactic for labor organizations during Railway Labor Act negotiations, strikes are only possible with the express permission of the National Mediation Board.

“They can only occur after the parties have passed through multiple legally mandated steps, and only when other safeguards, such as Presidential or Congressional intervention, do not occur,” it said. “ALPA’s [May 17 strike authorization] announcement is consistent with the recently announced authorization votes from other represented carriers who continue to bargain without any interruption to their operations. FedEx is focused on reaching a comprehensive agreement and remains committed to bargaining in good faith with our pilots to achieve an agreement that is fair to them, our other team members, and all other FedEx stakeholders. The results of ALPA’s strike authorization has no impact on our service as we continue delivering for our customers around the world.”

Jerry Hempstead, president of Orlando-based Hempstead Consulting, said in a recent interview that as many airlines have renegotiated their pilots’ contracts of late, other pilots always want what the other ones are getting and more.

“Pilots as a group are the highest paid employees on the planet and therefore puts stress on the P&L when they demand and get more concessions on work rules and compensation,” he told LM. “The pilots also see the FedEx stock is up over $100 a share in the last year and they want to enjoy some of that, so it’s hard for management to plead poverty.” 

And Josh Taylor, Senior Director of Professional Services, for San Diego-based Shipware, an audit and parcel consulting services company, said he was surprised to hear FedEx pilots had rejected the tentative agreement brokered by ALPA leadership just over a month ago.

“After working for so long without an updated contract, it seemed like things were finally coming together,” Taylor told LM. “Nothing I’ve read details why union members voted 57% against ratifying the new contract, but there is a growing need for more pilots and not enough trainees in the pipeline. Pilots at many airlines are capitalizing on this new leverage, including at United Airlines, where they secured a cumulative pay increase of 42% just weeks after the FedEx deal was announced. No service disruptions are expected as FedEx and its pilots return to the negotiating table, perhaps with the help of National Mediation Board.”