UPS initiative reduces overtime as it recruits for peak season

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diving letter:

  • UPS’s initiative to reduce late departures and deliveries is also reducing overtime, with the company promoting a better work-life balance as it’s hiring for the busy peak season.
  • The company’s Total Service Plan, launched in July, uses technology to reduce idle time by targeting on-time departures for delivery truck drivers. UPS’s overtime hours fell 1 million in the third quarter, while driver on-time performance improved 13% since the plan’s inception, executives said on a conference call Oct. 25.
  • UPS Central Plains District President Darren Jones said in an interview that a healthy work-life balance is one of UPS’s top priorities during the peak season as the company is in the process of hiring 100,000 seasonal workers.

Dive insight:

The hiring environment for warehouse workers remains challenging and highly competitive, said Jeremy Tancredi, partner in West Monroe’s Operations Excellence practice. Those with the greatest success offer shorter and more flexible working hours.

“There will always be forced overtime as the volume fluctuates, turning an 8-10 hour shift into a 10-12 hour shift,” Tancredi said. “That’s a big reason [why] People didn’t take these jobs because they were so inflexible and the hours were so long.”

Through UPS’s Total Service Plan, the company is working with its employees to reduce the average daily hours worked, Jones said. He also highlighted a faster hiring approach to hire more seasonal workers. UPS rolled out a streamlined application process that reportedly takes 25 minutes — from completing an application to receiving a job offer — for most people.

An expedited hiring process is a benefit for UPS, allowing the company to attract peak-season workers who would otherwise take summer jobs elsewhere, Tancredi said.

“The early bird gets the worm, if you will, and so you slow down the hiring velocity and you’re more likely to hit your hiring plan because you’re not losing employees to other companies and other competitors,” he noted.

Other delivery and logistics service providers are also in the middle of the high season of the hiring spree. The US Postal Service announced in September that it would hire 28,000 workers for peak periods, while DHL’s Supply Chain and eCommerce Solutions divisions plan to hire thousands of workers to meet furlough demand.

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