UPS Caps Driver Buyouts at 7,500 and Offers $150,000 Severance Package
UPS and the Teamsters agreed to cap the Driver Choice Program at 7,500 voluntary buyouts nationwide, ending disputes over its national master contract. Under the plan, eligible drivers receive $150,000 plus pension and healthcare, as UPS seeks to cut 30,000 jobs and save $3 billion by halving Amazon volumes.
1. Settlement on Driver Buyout Program
UPS and the Teamsters reached a deal to cap the voluntary Driver Choice Program at 7,500 participants nationwide. This agreement resolves union grievances over the 2023 national master contract and ends pending arbitration on the buyout plan.
2. Driver Choice Program Terms
Under the Driver Choice Program, eligible long-haul feeder and package car drivers will receive a $150,000 payment plus accrued pension and healthcare benefits. Applications will be approved based on seniority and business needs across all regions.
3. Workforce Reduction and Cost Savings
The capped buyout is part of UPS’s broader effort to shed up to 30,000 positions in 2026, following 48,000 cuts last year. After this program concludes, no additional severance plans will be offered until the contract expires on July 31, 2028.
4. Scaling Down Amazon Volumes
UPS is on track to reduce its Amazon shipping volumes by 50% in the second half of the year, a strategy projected to generate $3 billion in savings. The shift aims to lower reliance on its largest customer and improve overall profitability.