It appears less-than-truckload carrier Yellow Corp. and the Teamsters will renegotiate their labor contract a year early as the two parties have failed to come to terms on proposed network changes, a spokesperson with Yellow confirmed to FreightWaves on Monday.
“On Friday, our board of directors voted to open our National Master Freight Agreement contract, something the IBT suggested several weeks ago,” Yellow said. “Completing One Yellow is essential to our company’s modernization efforts and is necessary for us to maintain and strengthen jobs while we compete against non-union carriers. Opening the contract early requires agreement from both parties; we have notified the IBT of that board decision and await a response.”
After a change of operations (COO) at Yellow’s (NASDAQ: YELL) YRC Freight and Reddaway terminals in the West was approved and implemented last year, union brass has said it is not on board with similar changes at regional carriers Holland and New Penn.
The last phase of Yellow’s multiyear restructuring, which seeks to integrate its brands into a superregional model, increase freight density and lower operating costs, would impact more than 200 terminals in the East, Central and South regions.
The carrier started the overhaul by realigning management teams, creating one sales team for its different brands and bringing all of the operating companies onto the same tech platform. The COOs are expected to eliminate redundancy throughout the network, including scenarios where multiple drivers from different carriers call on the same customer locations.
The entirety of the process includes the closure of 28 terminals, the proceeds from which are being used to pay down Yellow’s roughly $1.6 billion in debt. Yellow has been unable to achieve consistent profitability and maintains the changes are vital to its survival.
A key sticking point in negotiations has been the creation of additional utility positions, requiring drivers to work freight on the docks and at facilities within 175 miles of their home terminal. Changes would also merge seniority lists, requiring some workers to rebid for jobs.
The International Brotherhood of Teamsters said its members have given enough over the past several years in the form of “literally billions of dollars in wage and pension concessions” and that the latest COO violates current contract supplements and is a mere workaround, allowing Yellow to make changes without opening the contract.
“The concession stand is closed,” Teamsters National Freight Director John Murphy told members on a Wednesday update call.
He said he recently informed Yellow to stop meeting with members about the COO and advised local unions to prepare to file unfair labor practices charges if the company attempts to negotiate directly with its members.
Yellow had been conducting meetings with local unions regarding the proposed changes. Some of the feedback gleaned from those sessions was used to craft revised COOs after the first take was shot down by union leadership. Recently, Yellow challenged union heads to put the changes to a vote, saying it was certain it would win.
Union leadership ultimately rejected those changes on March 23 without a vote by membership. The following day the union doubled down on its hard-line stance, giving Yellow a 30-day notice that it would no longer be able to use purchased transportation to move its freight.
Murphy said opening the contract, which expires March 31, 2024, and covers more than 22,000 member employees, is the only fair course of action. But he cautioned that in doing so, “The company will need to come up with sufficient financial improvements.”
He pointed to flaws in the current deal, claiming that wages are “way too low and below standard” and that Yellow has “at least a $5 per hour, per employee labor cost advantage over ABF [ArcBest], our other legacy national master freight agreement carrier.” He also said that Yellow’s pension contribution rate is down to just a little more than 25% of the rate it contributed in 2009.
Yellow has a 3% annual wage increase of 80 cents per hour slated for 2023, with the first half beginning in April and the second half starting in October. The company also implemented a 37-cent cost-of-living adjustment in April.
The Teamsters will now be negotiating contracts with Yellow, ArcBest (NASDAQ: ARCB), TForce Freight (NYSE: TFII) and UPS (NYSE: UPS) this year.
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Dennis Marion Safrit Sr.
ok everyone,yellow just borrowed 1.15 billon dollars!!!! how does a company or corporation keep this up when they keep crying about how the employees and the union is causing all this dismay in the company????? they still don’t have their act together in the west were told not to use purchase transportation and was gave a 30 notice and has completely ignored that they are still stealing our freight here at holland and to find out that purchase transport was only being used at holland to steal our freight and none of the other companies were affected by them. If holland hadn’t been acquired by these thieves they would have gone out of business in 2005!!!I will stand up for the union now, they are actually doing there jobs. look around at how much they have been doing.The company only wants this push because they want to keep downsizing to put more money in their pockets!! who wants the badge of a super carrier none of us!! not only does it sound stupid but look at who’s trying to become one!! they shouldn’t have rebrand it yellow they should have called it The Burnie Madoff corporation it would have been a better fit!!!!!! let’s not fool ourselves if it wasn’t for Holland, New Penn and Reddaway this place would have been in the dumps years ago. The goverment, the investers, and the union needs to pull together and fire the first tw0 floors of this place and get some people in there that are a whole lot better qualified and running a freight company.Before USF bought Red Star,Holland,Reddaway,Dugan,and acquired Preston and Glen Moore Transportation these companies were doing great. then they were all sold to YRCW and that was it!!!! People look back at your history that’s where the truth lies. Yellow needs to just back off and let us do our jobs!!! They damn sure can’t. This company is not like anyone else, Holland was and still can be the leader in the fright industry with the right people on the top floor!! If this doesn’t change it will be Yellow or whatever they want to call their selves own fault for the failure of this not the employees that have been the ones making the ultimate sacrifices . I myself want to thank the union for stepping up when we needed them the most.
Don Cunat YRC Montgomery Il. 28 yrs
At the first giveback in the midst of a world wide financial crisis there was no choice but to cross our fingers and say yes. Now is different with some effort a new job can be found. Our affirmation lead to the next 14 years of of less of everything, money equipment tech market share and most importantly our pride. Its time for the employees to call in the marker or say no and and end the uncertainty sacrifice and humiliation. No its not drama its fact.
Leo Cook
Yrc and the union need to talk to the employees. Then they can really find out how sick they are of both of them. I worked for yellow a long time ago and they haven’t changed its all about the money for them and there stock holders. The little guys that bust there humps and beet the streets can always be replaced. That’s there slogan’s.