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Teamster Freight Members Ratify YRCW Job Security Plan

Posted on: Thursday, 8 January 2009, 17:12 CST

Agreement Will Protect Union Workers' Jobs, Benefits

WASHINGTON, Jan. 8 /PRNewswire-USNewswire/ -- Teamster members who work at the freight companies of YRC Worldwide Inc. (YRCW) -- Yellow, Roadway, Holland and New Penn -- have approved a plan that will protect the jobs and retirement security of tens of thousands of Teamsters. The modifications were ratified by a 77 percent to 23 percent margin, with more than 75 percent of members casting ballots.

Union members voted over the past month and ballots were counted today. The plan calls for a reduction in gross wages and mileage rates of 10 percent -- that took effect when all the ballots were counted today -- through March 31, 2013, plus suspension of a cost-of-living adjustment. The wage reductions apply to all bargaining unit and non-bargaining unit workers, including management. There is no change to any health, welfare and pension contributions.

"While we never want to see wage reductions, this vote shows that our members understand that we are facing the worst economy since the 1930s and that the company needs some help to get through this difficult period," said Tyson Johnson, Director of the Teamsters National Freight Division. "We are hopeful that this agreement will protect the livelihoods of our members and their families by protecting the jobs and health, welfare and pension benefits of our freight members."

The plan has a provision that will allow Teamster members to recover lost wages if YRCW's stock price goes up in the future. This would be done through warrants, which are similar to stock options. In addition, union members have protections, including language on monitoring and enforcement rights.

"We are facing the worst economy in our lifetime, so we needed to act now to protect our members and their families," said Jim Hoffa, Teamsters General President. "We worked hard to draft a plan that holds the company accountable, requires equal sacrifice among all YRCW employees, gave us the ability to obtain stock in the company, and placed restrictions on where the savings can be used, among other protections for our members."

The original count timeline of December 31, 2008 agreed to jointly during negotiations, was extended to today after YRCW announced on December 24 it was cancelling its tender offer for certain outstanding bonds and is renegotiating its credit facilities. The company will not have to spend $150 million to purchase about $310 million worth of senior notes and will instead renegotiate the terms of its debt with its banks. The union believes this path offers a more viable long-term recovery plan. The vote deadline was extended to give members more time to cast ballots due to a high volume of ballot requests, the company's change in financing plans, holiday mail volume and bad weather that shut airports.

YRCW said it was pursuing the new strategy in part because the Teamster membership had not ratified the contract modifications as of December 24, 2008. The union was proceeding with ratification on the schedule that was jointly agreed to and dictated by the now-aborted tender offer. Since the company's recent decision provides more flexibility, the union extended the balloting deadline to today.

"We extended the balloting deadline because we were committed to making sure all affected members had enough time to vote," Johnson said. "Our team of experts will monitor YRCW's financial situation closely to make sure our members' jobs and benefits remain protected. We will provide our members with updates as this process moves forward."

The International Brotherhood of Teamsters was founded in 1903 and represents 1.4 million hardworking men and women throughout the United States, Canada and Puerto Rico.

SOURCE International Brotherhood of Teamsters

Source: PR Newswire

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