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Three YRC units could disappear if labor contract is rejected, Teamster executive warns

Will they be running on empty? (Photo:Shutterstock)

Less-than-truckload (LTL) carrier YRC Worldwide’s (NASDAQ:YRCW) long-haul unit and its two key regional units could go out of business by the end of May should unionized workers vote down a tentative five-year collective-bargaining agreement early next month, the head of the Teamsters union’s freight division has warned.

Ernie Soehl told the rank-and-file on a nationwide conference call on the evening of April 10 that customers will pull their freight from the three units should members vote down the contract on May 3, the date when the results are to be announced. If customers react in such a manner, long-haul carrier YRC Freight and regional carriers Holland and New Penn Motor Express will likely not last until May 31, the date a two-month extension to the existing agreement is set to expire, Soehl said.

YRC’s shippers are closely monitoring the status of the contract talks, Soehl said. Should the tentative agreement be rejected, “it is my personal opinion, and the opinion of the (negotiating) committee, that we will not make it to May 31,” he said. Shippers threatened to pull business in the days leading up to the tentative agreement at the end of March, and some accounts have already defected, Soehl added. The extension was designed to keep the business stable while the rank-and-file reviews the proposal and votes on it.

Soehl’s blunt assessment means that for the third time in less than a decade, YRC’s unionized workers will vote on an agreement as if the company’s fate depended on it. In 2010, faced with the strong prospects of YRC going out of business, the rank-and-file ratified a contract calling for punishing pension cuts and 15 percent wage reductions. Then in 2014, the members approved a memorandum of understanding (MOU) which effectively extended the terms of the 2010 agreement, although it did call for wage increases, albeit off the reduced base. The members rejected management’s first proposal, leading the company to warn that there “was no plan B” and that liquidation could be the result of a “no” vote. YRC’s lenders had conditioned future financing latitude strictly on a successful extension of the 2010 compact.

Now the threat of a contract rejection leading to the company’s dissolution comes from the union’s leadership. A rejection would be tantamount to the members authorizing a strike against YRC, Soehl said. But a strike would likely never come to pass because there would be no business left by the time a walkout took place, he added.

Neither YRC nor a spokesman for the union’s freight division responded to requests for comment.

About 24,000 Teamsters are employed at YRC, according to company estimates. (other estimates put it as high as 30,000 members. That includes members in a fourth unit, Reddaway, which is governed under a separate labor contract. YRC is one of the last – and the largest – truckers that were part of the once-mighty Teamsters’ freight division. At its peak prior to deregulation in the late 1970s, the division boasted more than 500,000 members. Since truck deregulation occurred in 1980, mergers, bankruptcies and the advent of non-union carriers have decimated the union contracts. The division has around 50,000 members today.

The contract proposal, which has received near-unanimous backing from local leaders, calls for a $4 per hour wage increase for most workers, spread out over five years, with a $1 per hour increase that would be effective immediately. The contract would be retroactive to April 1, 2019. That translates to an 18 percent increase for most workers over the contract’s life. The contract eliminates the current MOU, and no longer pegs wage increases to the lower thresholds. “A dollar is a dollar, not 85 cents,” Soehl said on the call.

YRC agreed to increase its annual contributions to the members’ health and welfare fund. The current pension levels would remain the same; the 2010 agreement froze pension contributions for a couple of years and resumed them at about 25 percent of prior levels.

The proposal restores one week’s paid vacation for workers that had earned four weeks vacation or more. That concession was made in 2010 and extended in the MOU. All unionized workers will get the additional one week’s pay, which will add 14,000 hours of pay per year, Soehl said.

The agreement establishes a class of non-Commercial Driver License driver who would handle local cartage rather than having YRC contract out the work to a non-union vendor. It also protects the higher wage for a CDL driver performing non-CDL driver functions. The pact prohibits the use of autonomous vehicles or drones for transporting freight. It allows, for the first time, the Holland regional unit to use purchased transportation, but caps the utilization to 8 percent of Holland total annual miles driven. It also empowers union negotiators to unilaterally curb or eliminate the purchased transportation programs at Holland and YRC Freight, where it has been in effect, on a limited scale, for five years.

Soehl said the union has extracted all the financial juice it could squeeze out of Overland Park, Kansas-based YRC. The company, Soehl said, doesn’t have another penny to spend beyond what it has agreed to in the five-year pact.

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Mark Solomon

Formerly the Executive Editor at DC Velocity, Mark Solomon joined FreightWaves as Managing Editor of Freight Markets. Solomon began his journalistic career in 1982 at Traffic World magazine, ran his own public relations firm (Media Based Solutions) from 1994 to 2008, and has been at DC Velocity since then. Over the course of his career, Solomon has covered nearly the whole gamut of the transportation and logistics industry, including trucking, railroads, maritime, 3PLs, and regulatory issues. Solomon witnessed and narrated the rise of Amazon and XPO Logistics and the shift of the U.S. Postal Service from a mail-focused service to parcel, as well as the exponential, e-commerce-driven growth of warehouse square footage and omnichannel fulfillment.

48 Comments

  1. Worked at yrc for almost a decade it was great at first then new management took over and they couldn’t even manage to supply us toilet paper … I left and never looked back horrible management of they would listen to drivers in the trenches instead of quite "trying " their ideas the company might survive but I very much doubt it will be around much longer with morons in management they have …

  2. Well disappear just like you make our pension and 15% give back for 10 yrs disappear. If the Teamsters sit bk and collude with Yrc to rip the employees off then they need to shut it down. Give us our 15% pay bk and then we can negotiate. Union companies set the standard for nonunion companies but now we are the lowest paid in the industry. Its a conflict of interest for the Teamsters to claim to represent us and at the same time be partners with YRC. Fight for us like you did for UPS and ABF Freight. That $4 raise is a complete scam and the Teamsters know it. That dont come close to restoring our pay to where it should be. The other companies will need drivers, dock workers, mechanics, clerks and everything it takes to accommodate the customers that YRC and the Teamsters couldn’t handle. Im voting No.!

  3. I took retirement last month from YRC. I wasn’t really planning on it but nature had the final say.
    Two things come into play regarding this new contract offer that folks just don’t want to accept as true.
    One issue is the pay structure. While a 4 dollar and hour increase over 5 years may sound nice to many people, all is not what it seems.
    Since 2009 YRC’s union employees have three times agreed to concessions to help keep the company afloat. Unfortunately similar sacrifice has never been put forth by YRC management which causes quite a bit of ill will.
    In essence, due to the concessions agreed to in 2009 and implemented in 2010, the proposed 4 dollar per hour increase, when/if it is fully in place in 2024 will bring the top hourly pay scale to a total of equal to 35 cents per hour over the top pay rate that existed in 2009. That is a defacto 35 cents per hour increase over a 15 year span. 35 cents over 15 years without even adjusting for inflation? Yes.
    Additionally, pension payments were halted for two years and upon resumption have been, and will continue to be made at 1/4 of the level required to keep the pension plan afloat. Hardly something worth supporting.
    The other elephant in the room is the rank and file’s perception of a lack of honesty by top leadership on both sides of the table. For ten years workers have been handed this same line about the company being on the verge of collapse. Frankly that line is getting old, especially when wage locked workers read about the tens of millions of dollars regularly being given out in white collar bonuses.
    This is a tough choice for union people. Nobody wants to be out of a job, but neither do people wish to continue being played for fools by BOTH their own union and YRC management.

  4. Wes Heilman. I retired from Holland almost a year ago at age 62. It’s amazing that every contract they use scare tactics to make workers believe they will lose their jobs and the union goes along with the company instead of representing their members. YRC management let key executives go and re hired them in order to restructure their pay and give large bonuses after the last contract. When you read that the president of your company gets a 10 million dollar bonus every year, but your under a 15% pay cut it’s hard to swallow. And then your union reps give themselves a raise right after the contract. Who believes them? What a con job!

  5. Look its not the greatest, but its also not the worst either. ABF got the worse of the 2 the year before. The merging of Yellow and Roadway took on more than they really thought about. It was poorly planned. The recession didnt help the situation either. Many made out like bandits, take a look what happened with Con-Way selling out to XPO, who got away with a hell of a lot more. When everyone voted to give 15 percent "back", thats exactly what happened. PERIOD. You voted to give it back. COLLECTIVELY. So stop bitching about the 15 percent already. Youre getting a raise for the first time in a decade. May not be all ya want but then again. YOU DON’T ALWAYS GET WHAT YOU WANT. DO YA?
    The pension problem??? Yeah we know. You were all warned long ago in the 90s it has a chance of going bankrupt. Thats why they started offering the supplemental 401k in case it does. The Teamsters were the first of all organized labor to do this. Even if the pension was still around ya could have had youre last car BOUGHT AND PAID FOR saving little by little over the last 20 years. The pensions are failing everywhere. Union or not. Even if YRC did contribute 100 percent, WHAT GOOD WILL IT DO???. Its gonna be gone in 6 more years. For those who started thinking beyond the idea that they’ll "fix it later" will still have somn in their pocket. Youre fault for not staying a step ahead. ONCE AGAIN, quit youre bitching. SHIT HAPPENS.
    Social securtity will still be around till 2092. Be glad it is

    Does YRC have problems with corporate and management. Yes they do. WHO DOESNT??? Look at XPO again. Theyre drivers are unhappy as can be. Business is business. Some are better than others. Theyre giving a 20 percent raise over 5 years. Right behind ABF. Youre vacation is restored in full. The health insurance remains the same, which is 2nd to none and YOU ALL KNOW IT IS. We still got overtime after 8 hours a day and 40 hours a week, which deep down we know Is rare now a days. Were not getting the inward facing cameras like all the right to work carriers have on their employees. They have even gone as far as keeping provisions in the contract that prohibits them from using automation. We still got a premioum package over all. Count the goods as well as the bads. Its not the 60s and 70s anymore. Times have changed. The road drivers deserve to keep their jobs too.
    I know everyones not a hundred percent thrilled about it. But if ya have a half glass of water in the desert and thats all there is. GIVE ME MY HALF GLASS OF WATER. Think with youre head and not youre worthless balls. . . . . . . BROTHA!!! Its a BIG step in the right direction after a decade of stagnation.
    The big banks, the IRS, and the FED are the ones to blame at the root of the problem. We have a debt based monetary system. Been that way since the civil war.

    30,000 jobs hang in the balance here. Many of us are new to the industry with loving wives, and kids, homes to tend to, cars to enjoy, vacations to go on and a lifetime to live. We still have a premium package compared to a lot of others if you really stop and look around hard enough. It may not be everything it once was, but its better than breaking youre back 70 hours a week for only mileage to bring home one third of what you would make at YRC. WHILE on top of it being on camera everywhere you go both inside and out with an electronic leash up youre ass. Even if you would find an hourly position anywhere, not getting compensated AT ALL for them cutting into youre playtime past 8 hours. WHERE ELSE would you go to where youll make 40 bucks and hour to drive or work the yard or dock??? GOOD LUCK, buddy. There is no where else YEAH IN 5 MORE YEARS OVERTIME IS 40 BUCKS AN HOUR.

    I dont mean to call anyone out but a LOT is being overlooked here. A LOT!!! I may be a newbie at YRC. But I’ll be damned if im gonna put us all out of a good paying job all because i didnt get EVERYTHING i want. We still got it pretty damned good here.

    1. Justin….you’ve not actually paid attention
      Better to put YRC under

      You don’t want to keep a shitty company on top of the heap

      I worked for Roadway and YRC for 25 years
      Proud Teamsters don’t let corporate greed run their lives

      I say NO

      Sayonara YRC….you made your bed

  6. I worked for Roadway Express for almost 17 years. I left a few years after they sold out to Yellow Freight. I could see the way things were going as Yellow was driving things into the ground. Back when I was there, the union was more for the rank and file and now they have become an ally for the company. I’m sure the top union officials are being paid off by the companies and getting their bank accounts very well funded while screwing over the members. I would say call the company’s bluff and see what happens. If they can still afford to pay out multi-nillion dollar bonuses, then they can afford to take care of the people that actually make the money for the company.

  7. I work for Rodeway originally then it became yellow what a shame we went from a very nice company to a company that did not care about the workers . This company put the union pension in bankruptcy just like this company has put so many other companies into bankruptcy let them go they deserve it everyone that wants a job will find one but the upper management will never have what they had got now they come and go within million-dollar packages.

  8. YRC WORLD WIDE A 3 Dollars per Hour would be Better FOR OUR LTL we help keep our promise now our family is hanging in the Wind YRC ROADWAY MADE MONEY AND SAID THE SAME THING IN 2010 NOW IS THE RIGHT TIME TEAMSTERS WITH TONS OF EXPERIENCE WE WILL STICK TOGETHER THIS TIME ON THIS CONTRACT FOR THE GOOD OF ALL 30,000 WORKERS. WE HAVE SACRIFICE A LOT FOR THIS COMPANY. UP FRONT MONEY IS OUR ONLY SET-BACK IN THIS CONTRACT 3.00 DOLLARS PLEASE .

  9. Lies and more lies tired of the BS the so called leadership Continue you to spout they gave millions to the people who crushed the company in the 1st place. Give me my yes mine 15% back 1st and we can deal but if you think I’m going to loan you my money and you come back asking for more without paying me back 1st NO!!!!

  10. Are we getting screwed yes probably so but the reality is these guys have too much debt and most of us don’t want to start over so yes to save my job I will vote yes because my family comes first

  11. Scare tactics to get ppl to vote in a crap proposal. Workers have sacrificed 10 yrs of 15% pay, retirement, vacation, etc. Let them close as other carriers are paying well over 20% better wages ..

  12. NO vote here! Pls vote ppl! A NON VOTE is counted as a YES! We must stand up and together as never before..

  13. Hey guys. Here is an example of tentative pay
    here in the Carolinas. Let me clarify on the money side. This is the city operation rate. (Now $22.11 P/H) ($3.72 P/H less 15%) /add equals $25.83 where we should b. ($22.11 + $4.00/5 years = $26.11} minus $25.83 = $.28 divided by 5 = .056 per hour raise per year for 5 years. That is your actual pay raise in this new agreement. That is unacceptable in my opinion.

  14. Then I say shut the doors we shouldn’t have to continue working with no retirement and being the lowest paid out here in the industry because a piss poor management a five-year contract would make 15 years with no retirement and only a $4 pay increase that’s half of most of their careers

  15. Bill the dumbass who cant spell roadway, not rodeway is lost your company when bought by yellow was one foot away from being in the toilet and flushed away. Yellow saved your ass. Now this contract is crap i agree, 15% for 10yrs 2.5 billion later they still giving bonuses to upper management. We are being asked to save the day again. Question you need to ask yourself where are you going to go?? How old are you? Are you will to do grunt work again being new hire?? Better have something than nothing.

  16. No one is making you stay here ABF is taking all drivers they can find. If you stay your choice, but remember they get what they pay for, no one is running for them anymore. NO BODY CARES NO BODY CARES

  17. I understand people are unhappy with the company’s proposal. I came into YRC,not yellow or roadway. 15% less than scale…Am I happy about that,NO!! Could the company pay more, I think so. Are we the lowest paid ,yea probably. But , everybody else is paying for their insurance and its crap!! Would you rather make more money and pay for insurance or take a little less and your ins. be taken care of? As far as the pension, it ain’t looking good for anybody.

    1. My insurance is probably just as good as yours and I’m not and will never again work for a Union company.

  18. Worked at CF for 13 years everyday we heard business is bad. When it finally closed it was like a big weight lifted off of me. Worked Holland for 12 years great company until YRC executives destroyed it. To my fellow employees CDL drivers are in high demand and you won’t have to look for work very long. Everybody wants to work for a winner,a place that has decent equipment, fair pay, and respect. YRC has none of that. Believe me when I tell you that a new beginning awaits you. Its time to put the old dog (YRC)down. The union only wants your dues money and have already sold you down the river with the last 10 year contract. Hold your head up high vote no and start a new chapter in your life. Don’t look back you will not believe how empowered you will feel.

  19. worked 10years for roadway/5years for cf .iam so glad that they folded.i found a better job and never looked back.scared money never wins.just leave.

  20. Tough situation u guys r in. Do u cut my throat w/ closing up shop? Or do u cut my arm off slowly and painfully w/ threats of closing up shop? U know James P will be cutting steak tonight…and tomorrow night. No concessions at his home. I feel for fellow Teamsters at YRC. We felt it back in August 2018. The sell job forced down our throats. Tricky. Stay strong . Industry is strong right now. Maybe some language could be agreed upon for pay us while things going good now. And reevaluate when things take a turn for the worst. Why not? I get it…company will always say things r bad. Earnings r public record.

  21. YRC should have gone a long time ago . If you are not delivering food beer or Amazon, your time in the trucking business is limited, very limited.

  22. I have been with Roadway and with YRC for the last 20+ years. We have heard this before. It took them days before they came out with plan B when we voted it down last time. At what point are you yes voters going to say enough is enough. If you don’t think the company doesn’t have money, look at the earnings, the top executives pay, the company shares they give to each other and for how much they sale it through out the year, the bonuses and …. should I keep going? You would have to ignore it purposely to not see they can pay us more if they want to or forced to. VOTE NO!! I GUARANTY A PLAN B.

  23. I worked at the corporate HQ in IT. The executives may make a lot, but not as much as you’d expect in a multi-billion dollar company. YRCW only has so much money.. It’s not fair to expect them to squeeze every ounce of money out when they’re trying to keep afloat a pension plan UPS bought out of.

  24. YRCW has not paid in to a pension plan in the west for almost a decade. They are giving us a 401k that is worth 25% of what they were paying in our pension. It is a 401k not pension. So when they are saying they are giving us a 25% pension, that is 100% false. So we are not asking too much if we are asking at the very least we want the 15% back that we SACRIFICED for the last 9 years to keep the company afloat so someday ( that someday is now) they would give us back what they owe us for standing with them when they asked us to. I don’t think they should run out of money when it is time to pay us, after they have been spreading it between eachother for the past many years. So we know what the market is like, the earning is like, and what we are worth for this company and what the company owes us, no matter what they say. We know what we are asking for John Doe.

  25. Yeah great idea, pay up or close up right? They don’t have the money like you think they do, that 15% is gone, and when you exact revenge over it you also put out of a job the thousands of non union workers that depend on their paychecks to feed their families. Don’t like the contract, vote yes then suck it up and find another job. Don’t drag everyone else because you are pissed off. None of your reasons are good enough to do that.

  26. Because of weak Teamsters like you, we lost our pension and pay. It is sad to see how much faith you have in your voting power. You are not going to lose your job Rob, you are going to gain a fair wage for a days work day. So sad for the way you think and how you have given up.

  27. Who said I was a teamster, Joshua? If I was, I would be smarter than to believe in the delusion that a Corporation is going to give back money they took to stay afloat. Yeah you got screwed, and so did the non union employees who also lost payments into their retirements and had their salaries slashed. Trust me guys, your voting power doesn’t hold so much power that you can get them to bend on that. It is powerful enough though to get a little more than what you have now, while keeping the doors open for company that employs thousands.

  28. Thank you for confirming my suspicion Rob. I wasn’t 100% sure I had a feeling you are a either an uneducated Teamsters or group of a management who is brainwashed in thinking we should believe what a company says. If I ca convince enough of them, we will show you the power we hold in our vote. Like I said on my earlier comment, If we vote it down I GUARANTY A PLAN B. VOTE NO AND GET WHAT IS COMING TO YOU TEAMSTERS BROTHERS.

  29. "…uneducated Teamsters or group of a management who is brainwashed in thinking we should believe what a company says."

    Haha, ok sport. Sit there in your tin foil hat spinning conspiracy theories and not even consider that I am instead neither one of those but has enough sense to see reality. Go ahead and vote no and see just how much better it gets. It won’t be much, if even at all.

  30. That’s ok Rob. I don’t expect you to understand what goes on at YRC because you said you are neither a Teamsters or part of the incompetent management. I guess that tells me that you are playing a guessing game while we are trying to ask for what we think is a fair deal. I made sure all the Teamsters believed that if they voted NO on the last conclusion, the company will come back with a plan B even though they said a NO vote would run us out of business. Guess what they had a plan B. You know why? Because we make the profits happen. It is as simple as that and they know it. The question is, does enough of the Teamsters know it call this company’s bluff just like we did last time. Come on Brothers we can do this. A No VOTE IS A BETTER FUTURE TO US AND TO THOSE WHO COMES AFTER US. UNITE AND BE STRONG!

  31. I am a teamster. When we voted down last time there was no Plan B same contract was voted on and passed because everything was in placed to close their doors. A no vote 30,000 people out of a job, a yes vote could mean 30000 people out of a job. Just everyone vote and dont be like UPS. Please have facts and not inquendos

  32. It looks like you need to get your facts straight Douglas. If you read and voted on the last contract, you know that even though it was not much, there was a pay raise on the plan B. So please don’t mislead the voters. I believe in giving the right facts to the best of my knowledge and have the voters decide for themselves. Your subconscious is telling you the right way to vote without you even knowing. Like You said yes vote could mean 300,000 people out of a job. Don’t let the the company lobbyist ( the weak union representatives ) and the companys usuallI lies scare you in voting yes my Teamsters Brothers. We sacrificrd and gave up billions to save the company so don’t think you are asking too much because you want what you had 9 years ago. Nothing more nothing less. I think we are being more than fair.
    I SAY A NO VOTE IS A BETTER FUTURE FOR CURRENT TEAMSTERS AND FOR THE ONCE THAT COME AFTER US. VOTE NO IF YOU WANT TO GET THE BENEFIT YOU ARE WORTH.

  33. still more of the same shit so you guys can keep getting the shaft or stand up for whats right. the union only cares about them not you this is all a scam and benefit for YRC and the unions pockets. im thinking for me and my family. good luck.

  34. Bonuses Given on February 14, 2019 in company stocks right before the new contract vote. 👎🏻

    Darren Hawkins $ 1,536,510.96
    Stephanie Fisher $ 252,142.92
    James Fry $ 252,142.92
    Mark Boehmer $ 173.351.60
    Brianne Simoneau $ 179,654.60
    Justin Hall $ 258,445.92
    Jason Ringgenberg $ 255,298.24
    Mitch Lilly $ 189,105.28
    Scott Ware $ 315,180.56
    T. J. O’Connor $315,180.56
    Loren Stone $189,105.28
    Howard Moshier $ 208,021.92

    Only the Teamsters would allow this to happen right before the vote. Who are these people really representing ❓Sick and tired of being stabbed 🔪 in the back by this gang of evil 👺 people.

  35. 15 % Pay Cut
    2 years with NO pay increase
    No pension after 2025. ( Out Of Money )
    I been supporting a Multi Billion Dollar company for the pass 10 years with more than $100,000 dollars of my money.
    While YRC is out of control giving out multi million dollar bonuses and on a crazy shopping spree, buying everything new. I Thought the reason for the 15 % Pay Cut was to pay off the debt ?

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