YRC Worldwide Inc. announced Friday, Nov. 28, that its Yellow Transportation, Roadway, Holland and New Penn business units have reached a tentative agreement with the International Brotherhood of Teamsters to modify the current labor agreement for employees covered by the National Master Freight Agreement. Details surrounding the modification are expected to be available later this week following further discussions with labor leadership and the affected employees.
“We have already taken a number of steps to strengthen our financial position and improve both our profitability and our competitiveness, including the continued successful integration of Yellow Transportation and Roadway, the exchange of equity for notes through private transactions, modification of our nonunion pension and retirement plans, sales of excess properties and, most recently, the commencement of a $100 million tender offer to purchase outstanding notes,” says Bill Zollars, chairman, president and chief executive officer of YRC Worldwide, based in Overland Park, Kan. “While these efforts have been effective, the worsening macroeconomic crisis in America and the increasingly critical state of our industry mean that we must take additional measures.”
Zollars says the industry decline in volumes and pricing is continuing in the current quarter, affecting YRCW’s profits and cash flow and its ability to pay down debt from operating funds. “The modification to the agreement, which we expect to be ratified in December, will establish a more competitive cost structure, allowing us to accelerate our market share recovery and capitalize on opportunities for future growth, while at the same time, defending the long-term prospects and job security of our employees,” he says.
“Extraordinary times call for extraordinary action,” says Mike Smid, president and CEO of YRC North American Transportation. “In that regard, our employees should be proud of the professionalism and seriousness that the Teamsters took on all fronts in their approach in reaching this tentative agreement. We look forward to continuing to work with them to protect the future of our employees and our company. At the end of the day, we have the interests of our employees and our customers in common, and together we are working hard to make our business more competitive and improve our position going forward.”
Tyson Johnson, director of the Teamsters National Freight Division, says the agreement will help YRCW get through the deepening recession and protect the jobs and health, welfare and pension benefits of Teamsters freight members. “This is a very difficult time for our members, but this agreement will protect the livelihoods of our members and their families, which is our number-one priority,” Johnson says.
The details of the agreement will be discussed on Wednesday, Dec. 3, with leaders of local unions that represent members from the YRCW companies. If the local leaders approve the plan, Teamsters freight members will be asked to ratify the agreement next month. About 40,000 Teamsters drivers, dockworkers, clerical employees and others are actively employed at the companies.
“I believe our freight members understand the terrible economic conditions that are battering the trucking industry,” says Jim Hoffa, Teamsters general president. “We are facing the worst economic environment since the Great Depression. We all need to work together to get through this period of uncertainty. This agreement will help protect tens of thousands of our members’ jobs. Failing to act now would be a grave mistake.”
