UPS, Pilots Agree to New Tentative Five-Year Labor Contract

United Parcel Service Inc. and its pilots have agreed to a new tentative five-year labor contract, ending nearly five years of negotiations.

The Independent Pilots Association, which represents UPS's more than 2,500 pilots, and the delivery giant aren't releasing details of the arrangement, although they said it provides for "improvements across all sections of the contract."

Sticking points until now included work rules, specifically to avoid fatigue. The pilots wanted more time to rest between flights, with rules closer to what the Federal Aviation Administration has mandated for airline pilots.

The union said it would recommend the new contract to its members. The contract must be ratified by a majority of the pilots in a vote completed by the end of August. If approved, the contract would become effective on Sept. 1.

The union had threatened it might strike if the two sides reached an impasse and federal mediators released it from negotiations, something that would have disrupted UPS's global package delivery network. UPS last faced a strike in 1997, when its Teamsters employees walked off the job for a little more than two weeks, costing the company an estimated $600 million.

Still, both analysts and industry experts had expected the two sides would likely come to an agreement.

Write to Laura Stevens at [e-mail]

(END) Dow Jones Newswires

June 30, 2016 13:15 ET (17:15 GMT)

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