Files in the /etc directory are managed in a special way. In order to allow the restoration of a package to the original condition all original unmodified /etc files are stored in an alternate location (usually /usr/upm/etc). uPM can display the modifications made to the original as well as restore the original configuration of each package. The logs can be used to find out on which day which configuration file was change.
If new configuration files are provided during an upgrade then uPM will build a diff from the original old configuration file to the new configuration file and apply that diff to the user modified configuration file. In most cases this will accurately upgrade the configuration file without the need for manual intervention. If this process would fail then uPM will provide the failing diff and refuse to install the package until it was invoked with a special option to override the situation or the maintainer has changed the configuration file by hand.