UPS Pays $1 Million To Settle Wage Theft Allegations Over Charitable Deductions
UPS workers in New York will receive more than $1 million from UPS after alleging the company illegally redirected money from their paychecks to a charitable campaign.
The wage theft lawsuit revolves around the shipping company’s annual fundraiser for the United Way. According to the workers, in 2019 and 2020 the company diverted money from their checks ― typically a $1 or $2 each time ― even though it didn’t have their written permission to do so.
Those small deductions apparently added up among a group of roughly 6,000 workers. The total amount over two years came to $789,432, according to court documents. Adding in other damages, UPS agreed to pay out $1.1 million, plus attorney fees, to resolve the claims. The United Way will keep the money that UPS donated.
The case was brought by members of Teamsters Local 804, which represents workers at the 14 UPS facilities.
Fred Lubarsky, a UPS worker, said in a statement through the union that he noticed the deductions in his paycheck a couple years ago. “When I told my manager that I never agreed to this and wanted it to stop, he gave me the run-around,” Lubarsky said.
UPS said it wouldn’t comment on the litigation. “We promptly investigated and addressed this concern when it was brought to our attention and we will maintain our commitment to the community,” a spokesperson said in an email.
UPS has been raising money for the United Way for decades. The nonprofit says on its website that the shipping company was the first corporate partner to raise $1 billion for it, praising UPS for “making a difference across the nation.”
Vinnie Perrone, the president of Teamsters Local 804, told HuffPost that as a former shop steward he watched managers “browbeat” workers into making donations, and that members have complained about the program for years.
“I’m a firm believer in charity and being a giving person, but you don’t need to donate through the United Way,” Perrone said. “You’re doing it through UPS, which is one of the biggest corporate donors to the United Way. They’re doing it for an ulterior motive.”
UPS says the pool of money comes from employee contributions, plus a match from UPS’ charitable foundation. UPS workers around the country chipped in more than $54 million in 2019, according to a UPS Foundation report. The company has more than 450,000 workers in the U.S.
But the workers who filed the lawsuit alleged that UPS managers haven’t always been aboveboard in funding a campaign that’s brought the company praise.
“When I told my manager that I never agreed to this and wanted it to stop, he gave me the run-around.”
– Fred Lubarsky, UPS employee and Teamsters member
According to the complaint, in past years UPS supervisors typically had a discussion with workers about the annual fundraiser, then encouraged them to sign authorization cards agreeing to have amounts taken out of their paychecks, either as one-time or recurring contributions. But in 2019, they say those agreements stopped, with many workers unaware that the deductions continued.
In their lawsuit, the workers faulted the way UPS allegedly incentivized managers to hit contribution targets at their facilities. The complaint said there are “compelling adverse consequences” if a manager fails to meet quotas, and “compelling positive consequences” if they do.
The Teamsters said any money workers don’t claim from the settlement fund will go to St. Jude Children’s Research Hospital and St. Mary’s Hospital for Children. Nathaniel Charny, a lawyer who handled the case for the workers, called it “an excellent result for the members of Local 804.”
Lubarsky said he was thinking of donating his share of the settlement “to a charity of my choice ― not UPS.”