Tuesday, November 22, 2011
9:56 pm EDT
9:56 pm EDT
YRC workers add concessions
Cuts in pay, pension and vacation time
YRC, formerly known as Yellow Transportation, has been having financial problems for some time. It has a terminal in Maybrook, above.Times Herald-Record/JEFF GOULDING
Drivers and other workers at YRC Worldwide have agreed to another round of concessions aimed at keeping the company financially viable.
The vote, tallied Saturday, extends a 15 percent pay cut workers had agreed to last year to March 31, 2015, reduces vacation by one week for workers with four or more weeks of vacation, and continues the company suspension of payments into union pension plans until the end of May. When payments resume June 1, they will be at 25 percent of the previous contribution rate.
The deal will reportedly save YRC $350 million a year. YRC did not return phone calls seeking comment.
Lawsuit challenges union agreement
Another shipping company has filed a lawsuit seeking to void the agreement YRC Worldwide reached Saturday with union workers, saying it violates the National Master Freight Agreement, the collective bargaining contract that covers most union trucking workers.
ABF Freight System filed the lawsuit and a separate grievance Monday against the International Brotherhood of Teamsters, YRC and others.
ABF is also seeking about $750 million in damages.
--Christian Livermore
Union officials have said the concessions — the third set that workers have agreed to — are necessary to keep YRC afloat.
"We're saying, look, save this company to make it a well-capitalized company that's not choking on its own debt," said Kevin McCaffrey, president of Teamsters Local 707. "Otherwise we're just playing kick the can down the road, where you're running out of cash again and coming back to the union."
But John Kelder, a driver who works at YRC's Maybrook terminal, said the company is asking for too much, and over too long a period of time. He voted against the concessions.
"When they came to us for the 5 percent giveback, they said they had to have it, and experts have looked at it and it would save the company," he said. "Then they came back for a second round of concessions that included freezing pensions, and they said experts have looked at it and it's enough to save the company. Then they came back again and said they need more from us. So somebody doesn't know what they're doing."
Ongoing financial troubles
YRC has been having financial problems for some time.
It narrowly avoided filing bankruptcy less than a year ago by convincing bondholders to swap $470 million in debt for equity.
But that wasn't enough. The company is still carrying about $1.2 billion in debt to banks and lending groups, McCaffrey said, much of it from the pre-recession days when times were good and YRC borrowed money to acquire New Penn, USF Holland and other companies, thinking it would have the money to meet the debt load.
As part of this agreement, McCaffrey said, YRC has to convince its lenders to forgive half the debt, renegotiate the other half and turn it into equity, and find a new equity investor willing to put $300 million into the company.
The company's financial picture has been improving in recent days. It posted a net loss of $9.5 million for the second quarter of 2010 compared with a loss of $309 million in the second quarter of 2009.
And its shipping activity picked up in the second quarter. Its National Transportation subsidiary's tons shipped per day were up 11 percent compared with the first quarter, and Regional Transportation's tons shipped per day were up 15.5 percent compared with the first quarter.
No comments:
Post a Comment