Contracts are a major part of all business. While many of these contracts are for goods, others pertain to labor. Though at times is it possible for parties to quickly reach an agreement and move on forward, this is not always the case. When parties experience difficulty reaching an agreement it may translate into a loss of time, energy and money for all involved.
United Parcel Service Inc. and the Independent Pilots Association have been negotiating a new contract for UPS’s pilots, for more than two years. The matters currently at issue include benefits, pension, scheduling and compensation for the approximately 2,600 pilots the union represents. Recently, apparently due at least in part to a decline in revenue for UPC, both parties agreed to enter mediation. The National Mediation Board is taking control of the matter.
While UPC may continue to see a decline in revenue while the labor contract remains outstanding, there is another reason why the business would benefit from reaching an agreement. It is possible that eventually the pilots could go on strike. Because the Railway Labor Act governs the contract however, before this can happen all negotiation processes need to be exhausted.
This is not the first time the National Mediation Board has worked with the two entities. The three previous agreements the parties reached were all done with the assistance of the National Mediation Board. Though the last contract took a couple of years to be reached, the fact that the National Mediation Board is involved seemingly bodes well for a resolution of the matter.
Mediation is a technique that can be used in a variety of situations to reach an agreement. While as in this situation, it may be required, other times parties may elect to use the alternative dispute resolution method on their own.
Source: The Wall Street Journal, “UPS and Pilots Union Move Contract Talks to Mediation,” John Kell, Feb. 5, 2014