A Tuesday letter from Teamsters leadership to local unions representing all of Yellow Corp.’s network said emergency negotiations that began on Sunday haven’t yielded an agreement. The union says its “bottom-line proposal” seeks the $11-per-hour wages and benefits hike previously offered by the company.
A July 12 letter from Yellow’s (NASDAQ: YELL) CEO to the Teamsters general president said the less-than-truckload carrier was willing to raise total compensation by $11 per hour over a five-year term if the union would acquiesce to its proposed change of operations. Yellow’s efforts to implement those changes, which it says are required for its survival, had been rejected by the union.
Yellow has also said that its lenders want to see full implementation of a company overhaul dubbed “One Yellow,” which includes the proposed operational changes, before restructuring its bloated debt load, $1.3 billion of which comes due next year. The carrier is in dire need of a financial reset and has said it will be out of cash at some point this month.
It recently missed required contribution payments to health, welfare and pension funds at Central States. The delinquency prompted a strike notice from affected Teamsters at YRC Freight and Holland, threatening a work stoppage on Monday. At the union’s behest, Central States granted the company a 30-day extension on the payment, agreeing to keep union members’ insurance coverage intact in the interim, thus averting a strike.
The Teamsters letter said the company previously informed the union it would miss payments to other funds as well.
Starting Sunday, Yellow and the Teamsters have met “nearly around the clock” to come up with a long-term solution that Yellow could show to lenders, which would allow the carrier “to obtain financing and restructure its debt,” according to the letter.
In the proceedings, the union asked for the $11-per-hour package. Yellow rejected and countered with “a proposal that was less than what it had told the Union and the members as recently as late as last week would be available.” The union rejected the counter and said the $11 increase is “its bottom line.”
“Yellow has not yet responded to the Union,” the letter said.
Company officials were not immediately available to provide their perspective of the negotiations.
The two parties stuck on the amount of the increase is odd given Yellow told Teamsters at the end of May that it wouldn’t be able to fund an increase as small as 60 cents per hour without approval from lenders. The Tuesday letter shows the two parties are haggling over a number that the company can’t pay without a capital infusion in order to get an agreement it hopes to sell to lenders.
All the while, the company is operating in a diminished capacity. Its customers have diverted freight and load boards have removed it as a carrier option. On Tuesday, an internal document showed it was “limiting pick-up operations in all terminals.”
“The Union stands ready to work with and assist Yellow in its effort to secure financing to avert a shutdown provided Yellow agrees to TNFINC’s [Teamsters National Freight Industry Negotiating Committee] proposal. While we await Yellow’s response, we ask that you remain the professionals you are famous for,” the union’s letter concluded.
Shares of YELL were off 24.3% Tuesday compared to the S&P 500, which was up 0.3%.
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Hardworking Yellow fellow
This thread hasn’t been posted to in nearly a month. Look where we are. The company is bankrupt, we are all out of a job, and just about now Sean O’Brien (for once!) has nothing to say. He single-handedly put the final nail into Yellow’s coffin, without asking the affected members’ input by discussion or vote. Maybe Sean O’Brien thinks Yellow was a **** job, but I assert that’s not his call to make; that’s OUR call. If he had put this to a vote and that vote sustained his position, he would be completely exonerated of fault. That didn’t happen. As a result, I say he’s very much got one foot in the “blame bucket”, and 30,000 former Yellow employees, 22,000 of whom were his members, are readying to do something about that. There are far lesser Teamster contracts than the one we are under, and he’s happy to take those peoples’ dues money too. Good thing: by the time Yellow’s employees get through, the IBT may be bankrupt as well.
Hammer down
Stop giving ceo’s bonuses they are not the ones out here driving doing all the hard work all 11 of them should get a pay cut an give it the ones who actually move the freight dock worker to truck drivers. They will go home to there big house an not worry about bills unlike drivers an dock workers. We have families that depend on us to provide for them.didnt yrc get enough money when they had that pay back program.drivers paying back money so the big shots can take it.i thought we went to work to earn a pay check not give it back.an work for free slavery is over in America.