Teamsters ratify YRC Worldwide concessions

Union workers at Yellow Transportation, Roadway, Holland and New Penn have agreed to modify their labor contracts to help the trucking companies survive the recession and an ongoing corporate restructuring, parent company YRC Worldwide and the International Brotherhood of Teamsters announced last week.

   The revised contract includes a 10 percent reduction in all wages and the suspension of cost of living adjustments. In exchange, drivers and dockworkers will receive a 15 percent ownership stake in Overland Park, Kan.-based YRC Worldwide. The plan has a provision that will allow Teamster members to recover lost wages if YRCW’s stock price goes up in the future.

   Seventy-seven percent of members casting ballots voted for the changes.

   Contributions to health, welfare and pension plans will continue unabated.

   The company said it expects to achieve $220 million to $250 million in annual savings from the labor adjustment during the remaining term of the contract signed last year. The estimates are based on ratification of similar contract adjustments by other Teamster and non-Teamster bargaining units not represented under the National Master Freight Agreement.

   YRCW said that non-union employees would experience the same or greater reductions in total compensation as their union counterparts. The company last year reined in several benefit programs.

   Non-union employees have also received options to purchase up to a 7 percent share of the company. Senior executives will not be eligible to participate in the stock option program. 

YRCW estimates it will save $75 million to $85 million from non-union compensation reductions that took effect on Jan. 1.

   Meanwhile, the integration of the Yellow and Roadway less-than-truckload subsidiaries is expected to provide a $200 million annual boost to operating income.

   During a time of economic hardship, we are proud of the understanding and support of our employees. The amended contract will provide our company with significant annual cost reductions that will also have long-term benefits as the economy recovers, said Bill Zollars, chairman and chief executive officer.

Source: American Shipper