UPS will cut one of the package sorting shifts at its Centennial hub in Louisville, Ky., threatening dozens of jobs.
On Feb. 16, the parcel giant will cancel the facility’s “day sort” shift to cope with falling package volume. This trend has persisted over the year as weak consumer spending and worries over a potential summer strike decimated demand.
“In our industry, packages equal jobs, and we need to match capacity and the number of jobs with current package volume,” a UPS spokesperson said. “Our employees are extremely important to us, and we understand the impact this may have on their families. We are working to minimize the impact to our people wherever we can.”
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Avral Thompson, president of Teamsters Local 89, which represents some 2,000 rank-and-file Centennial hub workers, said that UPS has been trying to eliminate this shift for years, and expects the layoffs to impact around 150 people. UPS did not confirm the number.
Some affected workers might be able to claim a role on a different shift.
Part-time employees, administrative employees and management will all be impacted by the layoffs, but drivers are not part of the cuts, UPS said.
In a statement posted by the local Teamsters branch on Dec. 29, the union called the day shift a “relatively small operation,” and said most or all its volume can likely be absorbed by bigger sorts at the Centennial hub.
“With LCH’s natural turnover rate, as well as the likelihood of the work being moved to the larger sorts, Local 89 does not anticipate a massive impact on our membership beyond shift and schedule changes,” the union said.
Months after reaching a new five-year labor deal with 340,000 Teamsters-represented employees that tacked on $500 million in 2023 expenses alone, UPS is still trying to figure out its long-term costs.
UPS said that the end of the day shift is one of several across the U.S. as it adjusts to customer demands, but did not name where other cuts would take place. The company’s Dallas restructuring last year largely impacted managers and supervisors.
UPS package handlers typically operate in multiple daily shifts, or “sorts,” at the Centennial hub. The day sort typically runs from 1-5 p.m., while the “twilight” 6-10 p.m. shift will continue as usual, UPS sayid. Other shifts at the hub include a late night sort and a sunrise sort.
In Louisville, UPS employs more than 10,000 workers between two metro area facilities—the Centennial ground hub and the 5.2-million-square-foot Worldport air cargo hub. The Centennial facility was established in 2007, and provides pickup and delivery operations for local shippers while serving as a transfer point for goods moving outside of Kentucky.
In early December, the Centennial hub was under the spotlight when roughly 35 specialists and administrative employees who had recently voted to join the Teamsters were told they would be laid off. The company then claimed those cuts were related to business, and not the unionization effort.
The union threatened to strike at UPS, claiming the layoffs violated labor practices. A day after the strike threat on Dec. 8, the company and union reached a deal that reinstated the 35 workers.
According to Local 95, the union is not privy to the details of how UPS intends to end the day shift. However, the local branch is actively investigating the situation and scheduled meetings with UPS labor management to discuss the plan.
“As always, we intend to enforce our contract and ensure all our members’ contractual and legal rights are respected,” it said.
In its third quarter, UPS saw total revenue decline 12.8 percent to $21.1 billion, with total average package volume down 10.8 percent to 20.4 million.
Through the holidays, UPS was still playing catch up. Chief financial officer Brian Newman said in the company’s October earnings call that UPS expected a low-single-digit to mid-single-digit decline in volume in December—steeper than the initially forecast of flat year-over-year volume totals.
The layoffs wouldn’t be the first recent restructuring effort at the Louisville facilities. In May, UPS made an “operational adjustment” at the Worldport hub, moving package sorting operations to a primarily nighttime operation. In July, the company eliminated its Friday day shifts at Worldport, which was mostly volume handled by the U.S. Postal Service.
