FedEx Campaign Delivers Controversy

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FedEx's new "multimillion-dollar marketing campaign" doesn't tout the delivery company's service or speed. It accuses rival United Parcel Service (UPS) of receiving a government bailout. FedEx's website BrownBailout.com claims UPS is "quietly seeking a Congressional bailout designed to limit competition for overnight deliveries." One marketing executive said the campaign may backfire on FedEx, as "this is clearly not a bailout as most consumers and business people would define it, which is writing a check to a troubled business." At issue is "a provision in a Federal Aviation Administration reauthorization bill" that would reclassify some FedEx employees under the National Labor Relations Act, making it easier for them to form unions. UPS, which is "heavily unionized," is already classified under the Act. UPS spokesman Malcolm Berkley said that FedEx "uses the fact of the labor law it is currently under inappropriately as a lever when talking to UPS customers, particularly when we're negotiating our contracts." UPS isn't responding to the FedEx campaign, but the Teamsters union, which represents 240,000 UPS workers, is. A Teamsters press release accuses FedEx CEO Fred Smith of spending "millions of dollars on misleading ad campaigns and high-priced lobbyists [rather] than allow[ing] workers a real chance to form a union."