timely quote

Patriotism means to stand by the country. It does not mean to stand by the president.

Theodore Roosevelt

Wednesday, March 25, 2009

This is how you handle it

Kudos to FedEx who is saying that they will cancel their 30 plane, $7.7 billion order with Boeing if Congress passes a law that removes them from union protection under the Railway Labor Act. Since FedEx was originally incorporated as an airline, their truck drivers aren't allowed to organize with the Teamsters without a national vote. The Teamsters have been trying to get in to FedEx for years.
Commissioning the 30 planes — at a price tag of $225 million each — is expected to create thousands of jobs for Boeing employees, workers at General Electric Co. who make the jet engines and workers at hundreds of subcontractor companies.

...

FedEx might be particularly concerned about unions forming within its ranks as the company's new economic realities unfold. Thousands of employees have taken wage reductions or salary freezes as the company tries to adapt to deteriorating demand, and it warned last week that even more cuts are coming. The company has also frozen 401(k) contributions for a year.
The best quote is this:

"If the regulatory and congressional environment remains hostile, there is virtual uncertainty over how we'd proceed," FedEx spokesman Maury Lane said Tuesday.

The change would "stymie competition and create an economic roadblock to recovery," he said.

...

"This notice gives Congress a chance to protect jobs instead of killing jobs," spokesman Maury Lane told the Associated Press on Tuesday. "This is a prudent business decision based on a potentially devastating Congressional decision."

Read the story here and here.

The legislation has been approved by a House panel already. Getting in to FedEx would be quite the coup, and this bill will move FedEx under the National Labor Relations Act. Of course, UPS with 50% Teamster membership thinks the bill is a good idea because it will "level the playing field."

In a note to investors, Avondale Partners analyst Donald Broughton said the bill is "directed at making it easier for the Teamsters to try to organize FedEx Express workers."

"We find it more than a bit intriguing that now Congressmen will have to vote against Boeing, GE, and the creation of thousands of unionized jobs for machinists (and several other trade unions) in order to change the labor law status of FedEx in an attempt to possibly help the Teamsters union," he wrote.

It sounds like the administration is beginning the process of paying back the unions for their support. Took him long enough I guess.

2 comments:

Anonymous said...

I guess you can still be proud to be in the union even if you are unemployed. "Look for the union label......"

folly said...

While I will admit that unions revolutionized workers' rights, these days they are nothing but the mob made legal. Why do you think so many mobsters got involved with the unions so quickly? They knew there was money to be made.

These days there's still money to be made, and it's all sanctioned by Congress. Well, Congress has a choice to make. Kowtow to the Teamsters and kill the possibility of thousands of other (union!) jobs created to build these planes, potentially putting FedEx out of business; or do what they said and let the free market create jobs.