Minneapolis, MN – On July 3, the International Brotherhood of Teamsters published an alert laying out a plan by the United Parcel Service (UPS) to offer buyouts for UPS drivers to retire early in exchange for cash payouts. When the Teamsters sent out the alert, UPS had not yet announced the plan publicly. Then on July 4, the company announced the plan, which they are calling the Driver Voluntary Severance Program (DVSP). For many drivers, taking the buyout would forfeit benefits they have accrued as part of their contract.
Carol Tomé is the CEO of UPS, and the company has been focused recently on plans to reduce jobs at UPS across the country. This includes closing outlying centers, consolidating warehouses, laying off employees, and re-orienting the company’s model to cut union jobs and focus on business and medical shipping.
The Teamsters are currently working under a union contract, which began in 2023 and ends in 2028. The union has slammed the planned program as an outright violation of that contract and an attack on workers and jobs. The Teamsters say that the DVSP plan is a violation of UPS’s contractual obligation to offer 22,500 additional permanent full-time positions for existing part-time workers over the course of the agreement.
“UPS is trying to weasel its way out of creating good union jobs here in America by dangling insulting buyouts in front of Teamsters drivers,” said the International Brotherhood of Teamsters President Sean O’Brien in the July 3 release, “It is an illegal violation of our national contract.”
UPS made over $91 billion in revenue in the 2024 calendar year. The total scope of the DVSP is unclear, as is the cash amount being offered. What UPS has said clearly is that the company is offering the buyout to all full-time drivers in the United States and has already announced it to drivers at many hubs around the country as of July 7.
Fred Zuckerman, secretary-treasurer of the Teamsters, called on Teamster drivers to stand strong, stating, “All drivers should reject this illegal and insulting buyout when UPS makes it public. UPS has forced buyouts on its own management in the past. They can’t force anything on us. Carol Tomé can screw over her own team. But she’s not gonna push around the Teamsters.” Whatever the scope or numbers of the DVSP are revealed to be, it is expected to have significant ramifications for Teamster represented UPS workers.
The DVSP plan is the latest piece to be revealed of a reconfiguration strategy at UPS. Over the last decade their strategy has been focused on market share of the U.S. shipping network, including residential shipping. Under Tome’s regime, that strategy has been shifting towards a primarily business-to-business and medical focus. While the direct delivery dominance of online retail giants like Amazon significantly increased, UPS’s own shipping of Amazon volume is planned to drop by 50% by the next calendar year.
Closures and consolidations of outlying centers and hubs, especially in rural and smaller communities, have already occurred across the country. In Minnesota, closures at the Morris, Red Wing and Owatonna centers were announced. The volume those centers handle will be consolidated into larger hubs.
In their contract, Teamsters have the right by seniority to follow their work and transfer to these hubs, as well as to be recalled in seniority order from layoffs. Closures like these force workers to decide whether to move, take on long commutes, or else find a job elsewhere.
At the same time, UPS has been carrying out hub and network renovations of the centers it intends to keep open. In many cases, the renovations have included automation of tasks previously carried out by union workers. The Teamsters Democrat, Republican, Independent Voter Education (DRIVE) political action division has raised concerns about automation at UPS. The Teamsters sounded the alarm on UPS’s increasing interest and experimentation in automation, including testing self-driving trailer shifters in hub yards and self-driving irregular package trams in many places around the country.
While it attempts to consolidate its operations and cut union labor, UPS is not entirely abandoning the residential shipping market. In 2021, UPS purchased a logistics technology company called Roadie, which specializes in same-day delivery and the delivery of oversized packages through a network of gig delivery drivers. As of July 2025, most residential volume remains in the UPS system proper, but the company has begun to test outsourcing some of this volume from Teamster drivers to the gig-economy platform.
The Teamsters rightfully say this is an attempt by UPS to circumvent its obligations set forth in the 2023-2028 contract and that they intend to fight back to protect their union jobs and conditions at UPS.
