United Parcel Service workers have ratified a new three-year contract despite a call by their union leaders to reject the pact, averting the possibility of a strike that could have snarled the nation's package shipping system.
Results announced Monday showed that 55% of the Teamsters Union members who voted approved the pact, which will raise average hourly wages to $17.60 in the third year of the contract from the current $16.10.
Leaders of the union, which represents 146,000 full- and part-time UPS workers, had recommended that members reject the pact. Workers had empowered the union to call a strike in the event of a contract rejection.
The contract expired on July 31 but was extended to enable the Teamsters to get ballots to all members. The final vote in favor of the new contract was 65,463 to 53,091, which union officials called a "particularly large vote return."
Teamsters General President William McCarthy said he was disappointed by the voting results, although he pledged to abide by the opinion of the rank and file.
"In the final outcome, I believe that many of the company's employees were frightened by management's ability to use permanent replacement workers, or scabs, in the possible event of a strike," McCarthy said in a statement.
Company chairman Kent Nelson said the new contract would enable the privately held parcel shipper to continue its international expansion.
"We are pleased that we were able to offer a package to our people they obviously found to be fair and responsive to their needs," Nelson said.
In addition to the hourly pay raise, the company said it would boost benefits to $5.05 from $4 an hour over the three years of the pact.
The company also agreed to pay a $1,000 signing bonus and a cost-of-living allowance of up to 20 cents an hour in the second and third years of the contract.
Part-time employees also will get increases in wages and benefits and a cash bonus of $500.