Shippers sailed rough seas in 2008 economic storm

They carry laptops and toys, cars and coal, but they're not Santa's elves, and they weren't very jolly this holiday season.

It's been a devastating year for the nation's railroads, trucking companies and package shippers - the companies on the "front lines" of the economic recession. Shipments have plunged as retailers pulled back on orders and consumers tied their purse strings tight in preparation for more hard times. Swiftly accelerating oil prices through the first seven months of the year crippled companies even more.

The Dow Jones Transportation Average, which incorporates railroads, shippers, airlines and logistics companies, lost a quarter of its value in 2008 and fell more drastically - by about a third - in the last three months of the year. That compares with a 40 percent decline for the Dow Jones Total Market index and a drop of 39 percent for the Standard & Poor's 500 index in 2008. Full Story......

Labor Pains Are Not Easily Shared

The Teamsters are not generally known for being easy to push around, so it is of some interest that the union's leaders have struck an agreement to allow the country's largest trucking company to cut the pay of its union members by 10 percent to help the firm survive the economic storm.

As you might expect, the deal does not come without a price: In return, union employees will get warrants that will allow them collectively to buy 15 percent of the stock of YRC Worldwide. The company has also assured the union that similar pay cuts will be given to nonunion employees, including top executives.

The hard-nosed calculation made by Teamster officials is that, with YRC's financial viability at stake, it is wiser and fairer to spread the pain among all active workers rather than force the company to lay off even more workers, or refuse to take a cut and possibly force the company into a bankruptcy reorganization in which workers and retirees would likely take even bigger hits. Full Story.....

Roadway Express to shut terminal in West Sencea that employs 198

The idling U. S. economy is putting the brakes on a local trucking facility

Roadway Express will close its West Seneca facility March 1 as part of a national consolidation effort by parent company YRC Worldwide to “integrate” 80 facilities into a total of 450 consolidated operations.

“These closures are a result of combining two operations and eliminating duplicate capacity and assets,” said spokeswoman Cecile Fradkin.

The company’s Yellow Transportation facility in Tonawanda will remain open. YRC Worldwide said some of the 198 union, hourly and clerical employees at Roadway Express may be taken on there, but declined to say how many or how they would be chosen. Nelligan said he expects very few workers will be given the opportunity to transfer.

The closure will come just three years after company restructuring led to expansion of Buffalo operations, which added 130 jobs at the West Seneca facility. But the slowdown of the U. S. economy has greatly decreased the volume of freight shipped by the company.

“We haul freight, so if the economy is in the toilet, we’re in the toilet,” said Ken Nelligan, secretary and treasurer of the Teamsters Local 449, which represents the workers. “Trucking feels it before anyone else, and we’ve been feeling it for a while.”

Word of the closing comes even as Roadway’s unionized employees here and across the country vote whether to accept a 10 percent pay cut. Those ballots were expected to be counted today in Washington, D. C., but bad weather extended the vote through Tuesday. The pay cut is expected to pass, Nelligan said.

“[Workers] understand the country is in bad shape as a whole,” he said.

The American Trucking Associations’ index of monthly freight tonnage blipped up in November but basically has been on a downward trend that saw it hit its lowest mark in five years the month before.

During the first half of 2008, meanwhile, nearly 2,000 trucking companies went out of business, the highest level since 2000-’01, according to industry analyst Donald Broughton of Avondale Partners. During the period, more than 88,000 trucks, or about 4.5 percent of the country’s capacity, were idled, Broughton estimates.

Company moves operations to Charlotte

YRC Worldwide Inc., the parent company for Yellow Transportation and Roadway Express Inc., will move its consolidation and distribution functions from Kernersville to Charlotte, a company official said Tuesday.

As the company completes this change, it will just have a local pickup and delivery operation in Kernersville, said Michael Smid, the president and chief executive of YRC North American.

"We just do not need two of those types of operations in the North Carolina area," Smid said.

About 210 employees in Kernersville will be affected by the changes. They are drivers, dock workers and employees who supply support functions. It may also include office workers and some mechanics.

The company should complete the merger of networks by March 1, Smid said. The affected employees have been told about the company's decision.

It has a distribution center under the Roadway brand on N.C. 66 South in Kernersville. The company has a distribution center under the Yellow brand at 1200 Amble Drive in Charlotte.

"The majority of these employees will have the opportunity to either move with the work or pursue the work in Charlotte or potentially other facilities in the region," Smid said. "So it's not a complete reduction or elimination of jobs. It's a repositioning and relocation of work."

Mayor Dawn Morgan of Kernersville said that she was saddened by the company's decision.

"This is not good news for Kernersville," Morgan said. "Over the years, Roadway employees have been key volunteers here."

The employees are members of the Teamsters Local Union 391 in Winston-Salem, and permitted to follow the work.

"If they choose not too, they will go into a lay-off status," Smid said.
The union learned about the company's plan Monday, said Bob Brown, an union business agent.

"We will not have any comments on it until we meet with the company," Brown said.

Local Job Loss And Financial Info

The Triad economy suffers more bad news with word that two companies are being affected by the recession right before the New Year. Video........

Roadway to close most of local facility

Tannersville terminal to lose estimated 143 jobsRoadway Express will close most of its Tannersville terminal by March 1, transferring or eliminating an estimated 143 jobs as part of a nationwide consolidation of the trucking company's operations.

The move will affect 55 drivers, 42 transfer dock workers, 25 mechanics plus other employees. Most of those jobs will be moved to other facilities.

Just a few jobs related to pickup and delivery will remain in Tannersville; the exact number is unclear.

"Tannersville will be a much smaller operation than it is today," said Mike Smid, president of YRC North America. YRC owns Roadway Express and Yellow Freight and is combining the companies. According to Smid, integration of the Yellow and Roadway will create the largest trucking operation in North America.

At the Yellow location in Allentown, 19 jobs will be gained, while Roadway in Allentown will lose 37 jobs.

Roadway's Tannersville location has experienced several staff reductions in the last few years. In recent weeks some Tannersville workers have been furloughed because of the season and economics.

Of the Tannersville workers affected "most will have opportunities to follow work to locations that are gaining work," Smid said. Those locations have not yet been determined. First, a change-of-operations hearing must be held with the Teamsters union, which represents the workers. That will happen in January, but the exact date and location has not been determined.

The "change of operations" is a document for the union which states the intentions of a company.

"It's a massive change. Probably one of the biggest I've ever seen," said a business agent who declines to give his name at Local 229 Teamsters in Scranton, the home union for Tannersville Roadway employees. Yellow and Roadway job transfers and work-force reductions are planned across North America.

"YRC is being forced to make changes in an attempt to cut costs. Unfortunately that will have some impact on our members. We will work tirelessly to ensure their contract rights are enforced and their seniority is protected," said Leigh Strope, a spokeswoman for the Teamsters.

Tannersville is one of 450 truck terminals in the United States owned by YRC North America.

CEO Zollars: YRC faces 'hard, long road'

YRC Worldwide Inc., a giant in an industry that’s a harbinger of economic feast or famine, has been fighting a downturn for about two years.

Theoretically, the Overland Park, Kan.-based trucking company will be among the first to show signs of recovery. But CEO Bill Zollars said he doesn’t expect improvement anytime soon.

“It will be a hard, long road back to recovery,” Zollars said. “The earliest we could expect it to start would be the second half of next year.”

The company monitors its shipments daily, watching for the increase in shipment size and then numbers that typically mark the beginning of recovery. Those figures, which usually show an uptick about six months before the rest of the economy, haven’t appeared yet, he said.

That means YRC will “continue to be kind of relentless on costs” to ride out the downturn, he said.

During the past year, the company laid off more than 5,000 employees, including 50 in St. Louis and 150 in Edwardsville, Ill.. The company also closed service centers and recorded hundreds of millions of dollars in impairment charges. In early December, YRC reached a tentative agreement with union employees to cut their wages 10 percent and suspend cost-of-living adjustments in exchange for a 15 percent ownership stake. The company also took steps to adjust the cost structure for nonunion workers.

YRC serves nearly 800,000 customers in most industry segments, Zollars said, but the customer base generally can be divided into half retail and half manufacturing — sectors that have shown general deterioration for about 15 months.

In addition, YRC has been trying to integrate its Yellow Transportation and Roadway divisions. Once done, the process will mean better service and efficiency, Zollars said. It’s been accelerated because of good results but has contributed to the layoffs and closures.

Zollars advocates fast action on some type of economic stimulus when Barack Obama is sworn in as a first crucial step to jump-start the economy.

“It’s really a function of getting consumer sentiment to stabilize and then turn around,” he said. “Right now, people have really stopped spending money.”

When YRC emerges on the other side of the recession, it and others that survive will be much more efficient, effective and stronger, Zollars said.

Advice

In the midst of ever-important cost-cutting, companies should avoid the tendency to eliminate strategic expenses, such as investments in technology and training, said Bill Zollars, CEO of YRC Worldwide Inc.

“That’s a mistake a lot of companies make,” he said. “You have to resist the temptation to try and cut back on those, and look long-term.”

Major Trucking Company Downshifting

Yawning Danger

Trucking companies are unwisely given an 11th hour at the 11th hour

Last week, safety advocates petitioned the federal government to reconsider a recent decision to allow truckers to work longer hours. The new regulations deserve more than reconsideration; they ought to be completely dismissed as a regrettable four-year experiment by the Bush administration.

Truckers used to be limited to driving no more than 10 hours straight, but in 2004, the industry successfully lobbied to have them expanded on an interim basis to 11 hours.

Has the 11th hour made the roads more dangerous? Are 11th-hour drivers more likely to be involved in crashes? Some research suggests no, and that's the evidence sited by the Federal Motor Carrier Safety Administration when it granted the rule change in November. But advocates say the government's analysis relies heavily on one study from the Virginia Tech Transportation Institute that is deeply flawed (depending, for instance, on truckers being videotaped; the presence of a camera onboard likely affected their performance).

The bulk of 35 years of research, the petitioners point out, shows that the performance of long-haul truck drivers diminishes even before the 10-hour limit is reached. And while the number of highway fatalities was down the last two years, it went up the first year the new rules were in place. Recent safety improvements to roads and vehicles as well as lower average highway speeds may be masking the effect of the longer hours.


The trucking industry supports the new rules, but a lot of truckers, including the Teamsters, oppose them. Certainly it's hard to see how forcing drivers of 80,000-pound vehicles to spend an extra hour behind the wheel is as risk-free as the trucking companies claim.

Reversing the rule won't be easy for the incoming administration. But repealing it, along with other questionable regulatory actions taken by the Bush administration during its own 11th hour, ought to be a high priority for President-elect Barack Obama.

DEADLINE EXTENDED TO JANUARY 6 FOR YRCW MODIFICATION VOTE

Members Have More Time Due To Number of Requests, Change In Company Plan

Due to a high volume of ballot requests from affected members, the company’s change in plans to gain financial stability which eliminates a December 31, 2008 deadline, holiday mail volume and bad weather that shut airports, the Teamsters Union is extending voting on the YRCW modifications until Tuesday, January 6. Ballots will be picked up at the post office at 10 a.m. on January 6 and will be counted later that day.

The original timeline of December 31, 2008 agreed to jointly during negotiations, was extended 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 move viable long-term recovery plan.

YRCW said it was pursuing the new strategy in part because the Teamster membership had not yet ratified the contract modifications. 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 is extending the balloting deadline. The Teamsters Union is committed to ensuring that all affected members have the opportunity to vote and is encouraging members to participate in this decision that will affect their livelihoods and the livelihoods of their families.

YRC Worldwide announces moves to ensure liquidity to survive downturn

As the economic road gets rougher, trucking giant YRC Worldwide on Wednesday announced maneuvers that chief executive officer Bill Zollars said would help it navigate through the difficulties.

The company said it had pulled a $150 million equity-for-debt tender offer for some of its notes after the Teamsters failed to approve a wage rollback by Tuesday’s deadline. YRC said it still expected the rollback to be approved by year’s end.

The Overland Park trucker said it was instead discussing with its lenders an amendment to its credit agreements that would improve its cash flow — an agreement expected to be in place by late January. The company also reported it had an agreement for a sales and leaseback of some facilities that would generate about $150 million in cash.

The nation’s largest trucker, employing more than 58,000, was recently forced to put up $1.5 billion in collateral after a debt-rating downgrade by Standard & Poor’s to CC, 10 grades below investment quality.

Investors reacted to Wednesday’s news by pushing YRC’s share price down nearly 20 percent, or 60 cents, to $2.64 in a shortened trading day. More than 4.3 million shares traded, compared with average trading of about 2.7 million.

“As we discussed the tender offer, it kind of became obvious that a better option for everybody would maybe be an amendment to the bank agreement rather than using cash to buy back bonds at a discount,” Zollars said Wednesday after the announcement.

“Because of the fact that we had been sharing our activities with the bank and our forecasts, we were able to move down the road to an amendment pretty effectively with the banks.”

Zollars said that the next three or four months would remain challenging as the economy continued to weaken. But through a number of efforts, he said, the company is building a “cushion” of cash to get it through until the second quarter, when the economy should begin to turn.

YRC reported it had more than $250 million in cash on hand but warned that if the Teamsters did not agree to reductions in its contract and it was unable to make other cash-generating changes, “the risk exists that the company would not have sufficient liquidity in 2009 to meet its operating needs.”

Zollars said such language was needed in a forward-looking statement to protect against the unexpected.

In early December, local union leaders reviewed and approved a proposal that called for about 40,000 YRC Worldwide drivers and dockworkers to take a 10 percent cut to help the struggling company. In exchange for concessions in pay, YRC would establish a trust that could give union members an equity stake in the company.

Officials had said they expected ballots to be counted by Dec. 30.

Under an “equal sacrifice” provision agreed to by YRC, non-union and management employees are also taking cuts in compensation.

Zollars said the wage rollback by the Teamsters would provide the company about $250 million in annual savings and the company would get an additional $100 million in savings from wage and benefit cuts to non-union employees.

He said YRC’s integration of its two biggest units, Yellow Transportation and Roadway, is expected to yield $200 million in annual savings.

He said the company also expected to do another sale and leaseback of facilities, such as the one announced Wednesday, that would generate about $200 million.

YRC reported it had a contract with NATMI Truck Terminals LLC to sell some of its facilities throughout the country for $150.4 million and to simultaneously lease them back for about $21.1 million annually. YRC said it could cancel the deal by Jan. 16 if it couldn’t get releases of existing mortgages by then. But it would have to pay NATMI a $750,000 breakup fee if it does.

FedEx Cuts Workers' Retirement Compensation While CEO Rakes in Multimillion-Dollar Pension

More Drastic Cuts in Workforce Compensation Fuels Drive for Teamster Representation

FedEx Corp. today announced drastic cuts in pay and deferred compensation for most of its U.S. workforce. Salaried U.S. FedEx employees will take permanent 5 percent to 10 percent base salary reductions while FedEx founder, Chief Executive and Chairman Fred Smith will take a permanent 20 percent reduction in base salary.

According to company statements, hourly employees will not see base wages impacted in this round of cost controls.

"The FedEx workers that have made this company a household name and deliver the profits will now shoulder more insecurity for their futures," said Teamster General President Jim Hoffa. "At the busiest time of their delivery season, the company is delivering nothing but coal for its workforce."

More dramatically for hourly employees, bonus compensation and the company's 401(k) matching contribution will cease for 2009. This unilateral decision to stop 401(k) matches closely follows the June 2008 capping of FedEx Express employees' defined benefit pension. In announcing the end of the defined benefit plan in 2007 FedEx said, "Planning and saving for retirement is a partnership between FedEx and its employees, and we are committed to helping our employees enjoy a financially sound future."

Apparently, that "partnership" is no longer part of the corporation's future.
Although garnering headlines for his salary adjustment, Smith meanwhile retains $26,411,752 accrued under the FedEx Retirement Parity Pension Plan and $1,164,464 under the Employees' Pension Plan. Additionally, Smith's $1.4 million salary only comprised 13 percent of the $10.9 million that he raked in for 2008. In fact, 55 percent of Smith's 2008 pay was in stock options not tied to any performance goals.

As of May 31, Smith also held currently exercisable, in-the-money options worth $24.9 million, based on yesterday's closing stock price. In the past two years alone, he's exercised options worth more than $60 million. FedEx has not clarified if the company's variable compensation changes will affect Smith's outstanding, exercisable options or if FedEx will suspend option grants for 2009.

"FedEx workers have seen their wages stagnate, their health care costs go up and their retirement benefits go down or go away entirely while FedEx has pocketed millions in profits in good times," said Teamsters Vice President At Large and Package Division Director Ken Hall. "Many FedEx workers already see Teamster representation as a way to secure their future and these drastic measures will convince more of the value of a Teamster contract."

The difference in pay and compensation between management and workers is one factor leading FedEx workers to seek Teamster representation. The broken "Purple Promises" on wages and retirement benefits were the subject of a public Blue Ribbon Commission hearing on Dec. 16, jointly sponsored by the Teamsters, the Los Angeles County Federation of Labor, and Clergy and Laity for Economic Justice/Los Angeles (CLUE LA).

Blue Ribbon Commission members U.S. Rep. Linda Sanchez, Los Angeles City Councilman Bill Rosendahl and United Methodist Church (Los Angeles) Bishop Mary Ann Swenson heard testimony from a number of FedEx workers on their deteriorating work conditions and struggles to hold onto the middle class life.

"I could afford to retire at age 62 under the defined benefit pension plan but with the stroke of a pen, and with little warning and no input or discussion from employees, FedEx changed our retirement plans," said Dan Forrand, a 15-year veteran aircraft maintenance technician from FedEx Express in Los Angeles.

Now, as the economy suffers and FedEx Express employees' retirement security is in greater jeopardy, FedEx has pulled a bait and switch more drastic than even Forrand knew on Tuesday.

Forrand's statement and other testimony and questions are archived online at www.fedxmx.com. Additional information is at www.FedExWatch.com.

Teamsters give $10,000 to Children's Home Society

Teamsters Local 175 delivered $10,000 worth of toys, food and financial donations to the Children's Home Society Thursday.

Twenty-two volunteers from the Teamsters and the Children's Society unloaded the truck.

"Our active and retired workers donated canned food and toys, said Ken Hall, a Teamsters international vice president.

"We have a Breakfast With Santa in December every year, where people bring canned food and toys. We also accept financial donations."

Teamsters moving to Mokena

After what officers of the union called a 20-year search for a new home, Teamsters Local 710 will move its offices from Chicago to a Mokena industrial park.

The new building, expected to be finished by October, will house about 60 employees of the local as well as its health, welfare and pension funds.

Chartered in 1903, the local now has its offices at 4217 S. Halsted St. and originally represented drivers working in Chicago's stockyards.

"The freight industry grew as the meat industry shrank," Pat Flynn, 710's secretary-treasurer, said at a groundbreaking Thursday for the new 30,000-square-foot building.

The nation's fourth-largest Teamsters local with 14,000 members, 710 represents drivers who work for companies such as ABF, Holland, Roadway, UPS and Yellow.

The local long had studied a move to the suburbs, said Jim Dawes, the local's president.

"This is a task that has literally taken 20 years," he said.

A ZIP code search of where its members live helped identify the southwest suburbs as the "perfect location" for an office that would be more accessible to 710's members, said Flynn, a Tinley Park resident.

"Our entire membership is out in this area today," he said. "This truly is the center of our universe here."

Apart from the union employees who'll work at the office, it will be frequently visited by members looking for information regarding insurance and pension issues, Flynn said. Local business, such as restaurants, could see increased business as a result, he said.

"Our members make decent money, and we spend it pretty well, too," Flynn said.
Having the local move its offices to the village will "bring a greater level of credibility and awareness" to Mokena, Mayor Joe Werner said. Another major union, the Pipefitters, also has offices and a training center in Mokena.

The union's office will be at 9000 W. 187th St. in Corporate Corridors, a business park being developed by Tinley Park-based TCB Development. It's the third such light industrial project undertaken in Mokena by TCB, which has built about 10 million square feet of commercial space in the Chicago area, primarily in the Southland.

Obama settles on Rep. Hilda Solis as labor chief

President-elect Barack Obama's choice to be labor secretary, Democratic Rep. Hilda Solis of California, is expected to advocate greater union influence in the workplace and more "green" jobs.

Solis, the 51-year-old daughter of a Mexican union shop steward and a Nicaraguan assembly line worker, is in line to be the second Hispanic nominee in Obama's Cabinet. Obama planned to announce her nomination on Friday, said a labor official who spoke on condition of anonymity because an announcement had not been made yet.

The lone member of Congress of Central American descent, Solis would replace Elaine Chao, the only original member of President George W. Bush's Cabinet still in office.

Unions, which contributed heavily to Obama and Democrats this year, expect Solis to be an advocate for them and for workers. They expect her to press for legislation that would force businesses to recognize union representation once more than 50 percent of a company's eligible work force signs union cards, instead of waiting for secret-ballot elections.

Unions claim mangers coerce and intimidate workers into rejecting unions in secret ballots at work. Employers say workers often are coerced themselves by their peers to sign union cards and that a secret-ballot election is the only way to determine their true wishes.

"Unions are vital to the health and strength of our communities, and our workers are the bedrock of our economy," Solis said in 2007 while advocating for the Employee Free Choice Act. "In this day and age when the number of women and new immigrants is increasing in the work force, it is important that they become a part of the American fabric and one of the ways is to be a member of a union."

Solis' father was a Teamsters shop steward in Mexico.

"We're confident that she will return to the Labor Department one of its core missions — to defend workers' basic rights in our nation's workplaces," said John Sweeney, president of the AFL-CIO, the nation's largest labor organization.

Solis in 1994 was the first Latina elected to the California Senate, where she led the battle to increase the state's minimum wage from $4.25 to $5.75 an hour in 1996.

Andy Stern, president of the 1.9-million member Service Employees International Union, recalled marching with her in Los Angeles — well before she was elected to Congress — to seek higher wages and benefits for janitors.

"We were with her fighting for the rights of people who work from the beginning and we're so proud that she's been chosen to be the labor secretary," Stern said.

Environmental groups noted that while in Congress, Solis wrote a measure that authorized $125 million for work force training programs in areas such as energy efficiency retrofitting and "green building" construction.

"We can think of no better person to help President-elect Obama implement his plans for an economic recovery fueled by the creation of millions of new green jobs," said Carl Pope, executive director of the Sierra Club. "Hilda Solis also understands that green jobs must also be good jobs and has worked to make sure that the clean energy economy is one that lifts up all workers."

Business groups, ready to assume a more defensive posture during Obama's administration, responded cautiously to the news about Solis.

"There's a new sheriff in town, but they'll still have to deal with the business community and they know it," said Randy Johnson, vice president for labor issues at the U.S. Chamber of Commerce. "We would hope she will continue to support programs that help educate employers about voluntary compliance with the law rather than pursue heavy handed enforcement," he said.

UPS Extends Relationship with NHRA

Will Continue to Handle Delivery Needs Of World’s Leading Drag Racing League

UPS today announced it has extended its relationship with the National Hot Rod Association as the league’s Preferred Shipping and Logistics Supplier.

"On the race track, drag racing rewards quick, safe and on-time performance. Those traits are synonymous with UPS and consistent with how we fulfill the delivery needs of NHRA race fans, officials and competitors" said Ron Rogowski, UPS’s director of sponsorship. "So UPS is extremely pleased to continue this association"

UPS has served as the NHRA’s Preferred Shipping and Logistics Supplier since the 2006 season. In other forms of motorsports, UPS will continue as the Official Delivery Service of NASCAR in 2009, when it also begins a primary sponsorship of Sprint Cup Series driver David Ragan and Roush Fenway Racing.

"We share the growing excitement leading up to the 2009 debut of the NHRA Full Throttle Drag Racing Series season" added Rogowski. "UPS is proud of its association with the NHRA and looks forward to continuing to provide excellent delivery and logistics service to all those in and around the sport"

Los Angeles FedEx Workers Testify Before Blue Ribbon Commission Panel

Workers Struggling to Stay in Middle Class Hope to Join Teamsters

FedEx workers in Los Angeles testified today before a Blue Ribbon Commission panel that they are on the verge of slipping from the middle class because of dwindling benefits, higher out-of-pocket medical costs and an overall decline in workplace conditions.

The Blue Ribbon Commission hearing is co-sponsored by: the International Brotherhood of Teamsters; the Los Angeles County Federation of Labor, AFL-CIO; and Clergy and Laity United for Economic Justice (CLUE). Economic experts, clergy members and workers discussed ways to help the workers remain in the middle class and remedy the anti-union situation they are battling. The commissioners on the panel are: U.S. Rep. Linda Sanchez (D-CA); Los Angeles City Councilman Bill Rosendahl; and Bishop Mary Ann Swenson of the United Methodist Church, Los Angeles area.

The workers said they hope to form a union with the Teamsters to gain a good contract that would guarantee them job security, better wages and benefits. But they said those efforts have created an anti-union backlash at many workplaces, with the company holding anti-union mandatory meetings, distributing anti-union literature, showing anti-union videos at work and engaging in many acts of intimidation.

"Pro-union employees are followed into restrooms by managers who look over stalls," said Rudy Hernandez, a 20-year FedEx employee who currently is a FedEx Freight driver. "Dispatchers tell drivers if they vote the union in, FedEx will close down this terminal."

But despite all the anti-union activities, Hernandez and four FedEx Express aviation mechanics testified that they remain committed to forming a union with the Teamsters.
Dan Forrand, a Senior Aviation Mechanic Technician at FedEx Express, said he planned to retire when he turned 62. But when FedEx changed its defined benefit pension plan to a cash balance plan on June 1, Forrand knew he would have to work longer to recoup financial losses.

"I've calculated that I'll lose about $230,000 that I would have accrued under the defined benefit plan," Forrand said. "I am worried that I am slipping out of the middle class."

Economic experts and clergy members voiced their support for these workers and discussed ways to remedy their situation.

"The bottom line: without a union, FedEx mechanics have no job security," said Jon Zerolnick, Senior Research Analyst for the Los Angeles Alliance for a New Economy (LAANE). "Currently their jobs can be outsourced and hours cut -- and lives are seriously impacted -- at the whim of management. They need a union to protect jobs."

"As members of the Los Angeles clergy community, we hear these stories of struggle every day," said Pastor Bridie C. Roberts of CLUE LA. "These workers need the help of everyone to keep themselves and their families in the middle class."

Over the last few years, FedEx workers have taken a look at Teamster strength in their industry. The Teamsters represent about 240,000 full-time and part-time workers at UPS and 12,600 at UPS Freight. The UPS and UPS Freight workers are benefiting from strong contracts that guarantee them wage increases, job security, good health coverage and a pension plan that cannot be taken away. FedEx workers have no contract.

The Los Angeles County Federation of Labor, AFL-CIO, is focused on promoting a voice for workers so they can remain in the middle class, or move themselves out of poverty, by joining a union. The federation believes that in educating and mobilizing workers to be politically active they can create and sustain healthy communities.

CLUE was formed with the purpose of organizing the religious community to support low-wage workers in their struggles for a living wage, health benefits, respect, and a voice in the corporate and political decisions which affect them. CLUE LA is an interfaith association of more than 600 religious leaders throughout Los Angeles County who come together to respond to the crisis of the working poor.

Thousands of layoffs by DHL, ABX Air hit Wilmington, Ohio

As hard times go, this is about as hard as it gets. The single-biggest employer in these parts is laying off about 7,500 men and women.
In a town of fewer than 13,000 people. In the midst of the worst financial crisis in generations.

"It's going to test us," says Mayor David Raizk. "The numbers are frightening."

Those numbers came in a Nov. 10 announcement by Deutsche Post World Net, the German owner of package-delivery company DHL. After investing five years and nearly $9 billion, DHL is abandoning its ill-starred effort to compete in the United States with FedEx and UPS. Winding down its U.S. business will eliminate 9,500 DHL positions around the country plus thousands more here at the company's local partner, ABX Air.

DHL, which has long struggled in the U.S., said in May that ABX would likely lose business that supported thousands of workers. But the global financial crisis magnified shareholder pressure on DHL's German owner and accelerated the erosion at the No. 3 company in a three-company market, triggering DHL's exodus. Exposure to bankrupt investment bank Lehman Bros. blew a $450 million hole in third-quarter earnings at the German giant's banking subsidiary, while DHL's customers grew tightfisted amid the spreading economic malaise. Full Story Here.......

UPS Freight Accelerates Service to and from Central Illinois

UPS Freight, the heavy freight arm of UPS, today announced faster transit times between central Illinois and points throughout the United States.

The new, enhanced direct service places all of Illinois under a next-day blanket and draws major markets, including Dallas, Atlanta, Pittsburgh and Minneapolis, to within two days of central Illinois.

In all, some 250 lanes to and from central Illinois will see faster transit times. Over the past 18 months, UPS Freight has accelerated transit times on more than 12,000 lanes, including 4,200 just in 2008.

"We intend to aggressively grow our business," said Jack Holmes, president of UPS Freight. "These enhancements are part of a long-term strategy to combine speed, technology and reliability to create an unmatched offering for our customers."

The new offering includes time-definite guaranteed service for all shipments when moving under UPS Freight's current 560 Tariff, plus improved visibility since all UPS Freight shipments will be handled by company drivers equipped with handheld computers. The handheld devices allow immediate input into UPS's information data network, making it easy to manage inbound and outbound freight shipments.

UPS Freight, one of the largest less-than-truckload carriers in the United States and a leading truckload service provider, serves customers throughout North America, Puerto Rico, Guam and the U.S. Virgin Island.

Teamsters Protest KeyBank at Arena

Bank Supports Labor Rights Violator Oak Harbor Freight Lines

Teamster members on strike at Oak Harbor Freight Lines protested outside of KeyArena in Seattle today. KeyBank, the corporate sponsor of KeyArena, is the main financier of Oak Harbor Freight Lines, where more than 600 Teamsters in the Northwest have been on strike for the past 12 weeks because of unfair labor practices by the company.

"We went to KeyArena to alert consumers that KeyBank doesn't want to help Washington families," said Al Hobart, Teamsters International Vice President and President of Teamsters Joint Council 28. "This bank supports the unfair labor practice strike we have at Oak Harbor, but they also cheat customers and lobby against Americans facing foreclosures."

The Consumer Federation of America reported that KeyBank uses deceptive practices to charge excessive and hidden overdraft fees. Worse, KeyBank sits on the board of several mortgage industry associations that fought to stop a Senate bill that would have prevented well over 1.2 million home foreclosures and avoided property declines of $200 billion.

"People need to know that KeyBank finances Oak Harbor Freight Lines," said Marv Deegan a retired Oak Harbor Freight employee. "Since Oak Harbor cut off our health care, I have to decide whether to eat or to pay my insurance premium. This is a terrible hardship for my family."

For the past 12 weeks, Teamster members have been walking strike lines in the Seattle area, and Portland. Soon after the strike began Oak Harbor announced they were ending the health care payments of striking workers and the retirees.

"It's cruel that any company could dump the health care of their retirees to the side of the road, but that's what Oak Harbor Freight has done," Hobart said. "And KeyBank is an equal partner with Oak Harbor in doling out hardship to families."

FORMER TEAMSTERS CHIEF DIES

The first democratically elected leader of the Teamsters died yesterday at age 72 in New York City.

Ron Carey was first elected to head the Teamsters in 1991 on a vow to end mob control. In his re-election bid in 1996, he narrowly defeated James Hoffa, Jr. However, in 1998, a court-appointed review board expelled Carey from the Teamsters, concluding, according to the New York Times, he “breached his fiduciary duty by failing to stop an illegal scheme that siphoned more than $750,000 in union money into his 1996 re-election campaign.”

In 2001, Carey was charged with perjury related to the scandal. He was later acquitted on all charges.

He is survived by his wife, Barbara, and five children.

Hoffa: Senate should reject death sentence for GM

What's ailing the auto industry in the United States is the same as what's ailing the industry in China, Japan, Europe and South America.

Carmakers around the world are struggling through the worst slump in 40 years. Sales of cars by Toyota and Honda fell more during the last year than did sales of cars by Ford.

For America's Big Three automakers, the bad news turned catastrophic last month. In November, 236,000 North American-made cars were sold. That is a shocking 40 percent drop from the number of cars sold in November 2007. No industry can afford a 40 percent sales decline.

Sure, mistakes were made. But the Big Three's dire straits are a result of frozen credit markets and a global recession.

Fortunately, many in Congress recognize that it's crucial to rescue the U.S. auto industry. The House has approved a bill negotiated with the White House that would use existing money for a short-term loan and restructuring of the troubled carmakers.

There are 1.59 million people employed by the Big Three, their parts suppliers and dealerships. As many as 5 million people depend on the auto industry for work, including Teamsters who haul cars, parts and supplies. Letting the domestic auto industry collapse would dramatically worsen a recession that's already a year old.

It would be disastrous to allow even one of the Big Three to seek bankruptcy protection. That would cause the failure of hundreds of auto parts companies and dealerships. The remaining Big Two automakers, dependent on the parts and dealer networks, would go under. Securitized auto loans and their insurers would fail, whipsawing fragile credit markets.

Another consideration: General Motors couldn't get financing for a Chapter 11 bankruptcy. So do the math. Bankruptcy for one automaker means GM closes its doors. For good.

There are some free-market wing nuts who are fine with that. We've all heard their arguments: "Since the automakers brought their problems on themselves, let them fail." Or, "Don't interfere with the free market."

But they ignore a lesson of the last century: America's peace and prosperity depend on a robust manufacturing base.

We would have lost World War II if we didn't have an auto industry that could produce weapons during the war. That's why Franklin Roosevelt called Detroit the "Arsenal of Democracy."

We would not have enjoyed record prosperity during the post-World War II era without a strong manufacturing base -- and productivity gains that were shared with workers.

In recent decades, we've taken our eye off the ball. Instead of shoring up our manufacturing base, we've favored the interests of Wall Street over other sectors of the economy. Nowhere is that more evident than in the ongoing, multitrillion-dollar bailout of irresponsible financial services companies. (By the way, I don't hear anyone complaining that the unions brought down Lehman Brothers.)

Now, Wall Street's follies are hurting the auto industry.

For those who would pull the plug on our domestic automakers, I ask them to consider that our economic competitors won't let their auto industries vanish.

The European Commission is offering $6.3 billion in industry loans for developing greener cars. The Swedish government said it's prepared to help out its automakers. Japan already subsidizes its auto industry by keeping the yen artificially low.

China's automakers, which are owned or controlled by the government, get research grants and loans from state-owned banks. They're asking the government for emergency help in the form of tax relief, lower gas prices and grants.

I hope Congress will take to heart Franklin Roosevelt's words: "The strength of this nation shall not be diluted by the failure of the government to protect the economic well-being of its citizens."

Plano mayor will not repeat

For the past seven years, Mayor Bill Roberts has found a way to balance his 14-hour work schedule as a truck driver with his duties as mayor.

But that has changed, and Roberts said this week that he will not, in fact, seek a third term for Plano's top office.

Roberts said his work schedule has changed at his company, USF Holland.

The mayor was assigned two weeks ago to begin work at 5 a.m. and end in the early evening. Instead of his regular 1:30 a.m. start, which allowed him to tend to city business, his new work schedule erases nearly any time for meetings, he said.

"I (now) have to scramble a little bit here with my sick, personal and vacation days to make my term work out. Every term for the last 7-1/2 years, there's been a chance of this happening," Roberts said.

Roberts had announced in late October that he planned to run for re-election.

But this week, he noted that USF Holland is trying to adjust to the new economic climate by implementing "a different philosophy," which came in the form of shift changes.

Economic growth

During his time as mayor, Roberts has previously said he is proud of the annexation and zoning of commercial property that has allowed retailers to come to town.
Also during his tenure, Waubonsee Community College announced a Plano campus, opening in 2010, and several properties downtown and along Route 34 have been acquired by the city.

"We laid a great foundation. With the challenging economy, we've done the right things. We've been frugal and careful," Roberts said.

Election in April

As far as the April election, at least one candidate, 4th Ward Alderman Bob Hausler, has publicly announced a run for mayor.

Roberts said he plans to express his support for a potential mayoral candidate, but would not disclose who just yet.

"There have been a lot of people who are disappointed (in the news) but it's beyond my control," said Roberts, who will serve a total of eight years as mayor when his term ends.

"I've gotten some very nice supportive phone calls," he added.

Obama: Transportation can get economy moving

When President-elect Barack Obama says he wants to get the economy moving again, he means it quite literally.

Transportation will play a central role in Obama's first months in office, not just for policy changes aimed at improving highway, air and rail travel, but as a road toward economic recovery, energy independence and environmental protection.

Solve road congestion, Obama's reasoning goes, and you put people to work.

Use less gasoline and help clean the air.

Build better trains and move goods more efficiently.

Get people out of their cars and reduce greenhouse gas emissions.

"We will create millions of jobs," he said recently, "by making the single largest new investment in our national infrastructure since the creation of the federal highway system in the 1950s."

This expansive approach contrasts with the Bush administration's policy that transportation - like other government functions - works best when it is in private hands, or at least in a public-private partnership.

Adopting a libertarian, smaller-government-is-better approach to repairing and modernizing the nation's transportation systems, Bush sought to shift more responsibility to state and local governments and encouraged the use of tolls and private enterprise to pay for it.

Obama is not necessarily against such arrangements. He just thinks the national government should play the leading role in a transportation network on which the country and its economy depends.

"Now is the time to invest in our future and strengthen our core infrastructure," Obama said in an October letter to a coalition of groups interested in transportation and environmental issues. "With unemployment rising, these investments are even more important."

Obama takes office as many critical transportation issues are coming to the fore, creating what some experts see as a once-in-a-generation opportunity to remake national policy.

"What's very hopeful about this president, when it comes to infrastructure, is he's prepared to think big," said Janet Kavinoky, chief transportation lobbyist for the U.S. Chamber of Commerce. She said there is broad political support for major changes in transportation policy.

Obama's transition team is working with congressional Democrats on an economic aid bill that could total as much as $500 billion. The hope is to have it ready for the new president to sign when he takes office Jan. 20.

While details have not been finalized, the bill is expected to include tens of billions of dollars for highway, mass transit, airport, and intercity passenger and freight rail improvements.

Bush's transportation philosophy "seemed to be, `This is what the federal government should be responsible for and nothing else.' And the `nothing else' category was public transportation," said William Millar, executive director of the American Public Transportation Association, whose members include transit agencies.

Obama, on the other hand, has described himself as a strong advocate of mass transit.

While Bush proposed what some lawmakers described as "starvation budgets" for Amtrak, Obama has pledged support for the passenger rail carrier and for developing a national network of high-speed passenger trains.

The Bush administration has feuded bitterly with air traffic controllers since the Federal Aviation Administration imposed a contract in 2006. Obama has promised to appoint an FAA administrator who will work cooperatively with controllers.

Bush tried to ease cross-border trucking between the U.S. and Mexico, angering domestic truckers who fear the competition and say safety would be compromised. Obama promised the International Brotherhood of Teamsters to aggressively inspect cross-border trucks and buses and enforce safety regulations.

Obama's transportation goals face several potential roadblocks.

The federal program that provides aid to states for highway construction and transit expenses expires on Sept. 30, 2009. The current program was funded at $286 billion over five years. Its cost is mainly underwritten by the federal 18.4 cents-per-gallon gas tax, but revenues have failed to keep up with obligations.

Last January, a blue-ribbon transportation commission recommended increasing the gas tax as much as 40 cents a gallon over five years. The additional money would to help cover the federal share of an estimated $225 billion the commission says is needed each year to upgrade transportation systems.

Boosting the gas tax carries political risks. The last time it was raised, a backlash against Democrats in the 1994 elections helped Republicans capture control of the House and Senate. Obama has expressed concern about raising taxes in the current economic climate.

Even without an increase, Obama will have to deal with environmentalists who want to undo a bargain struck during the Reagan administration that funnels roughly 80 percent of gas tax revenue to highway projects and 15 percent to transit. They want to redirect money away from highways to alternatives such as transit and intercity passenger trains.

Obama's energy plan calls for saving as much oil as the U.S. currently imports from the Middle East and Venezuela within 10 years, which is about 3.5 million barrels a day.

"That's going to require a pretty robust program to save oil, which means not just better vehicle technology and not just alternative fuels. ... Something will have to be done about transportation policy," said Deron Lovaas of the Natural Resources Defense Council.

"The question is, does it make sense if energy security is an overarching national commitment to stick to ... a 25-year-old deal?" Lovaas said. "I think the answer is, `No.' That's going to be an enormous fight."

Jobless claims jump to 573,000, a 26-year high

The U.S. labor market weakened further last week, with the number of first-time filings for state unemployment benefits jumping by 58,000 to a 26-year high of 573,000, the Labor Department reported Thursday.

The number of people collecting unemployment benefits rose by 338,000 to stand at 4.43 million, also the highest since late 1982. The increase in continuing claims in the week ended Nov. 29 was the most since 1974.

The jobless claims report shows businesses are laying off workers at a rapid pace, and finding employment is ever harder for those who've lost their jobs. Read the full jobless data report.

Compared with the same week a year ago, new jobless claims are up about 59%, while continuing claims are up 58%.

Initial claims represent job destruction, while the level of continuing claims indicates how hard or easy it is for displaced workers to find new jobs.

Several technical factors could have boosted initial claims last week, a Labor Department spokesman said. The week after Thanksgiving is traditionally the one with the biggest increase in first-time claims, and the government's seasonal adjustment factors may be overstating the increase this year.

Part of the increase in filings last week could simply be administrative catch-up from Thanksgiving week, when most state unemployment offices were closed for two days.

Worsening trend

Technical factors aside, the report shows a marked deterioration in the labor market. The four-week moving average of new claims -- which tends to smooth out the impact of any special factors -- rose by 14,250 to 540,500, also the highest since late 1982.

The four-week average of continuing claims rose by 131,000 to 4.13 million, the highest since early 1983. "This number suggests that the national unemployment rate will rise to 7.0% or more in December, versus 6.7% in November," wrote analysts for Ried Thunberg ICAP.

The insured unemployment rate -- the proportion of covered workers who are receiving benefits -- increased by two-tenths of a percentage point to 3.3%, the highest in 16 years.

Next week's report on initial claims will cover the same week in which the monthly survey is conducted."The current four-week moving average of initial claims, at 540,000, is consistent with about a 500,000 monthly drop in nonfarm payrolls," wrote Joshua Shapiro, chief economist for MFR Inc.

In November, 533,000 nonfarm payroll jobs were lost, the most for a single month since 1974. The economy has shed 1.9 million jobs since the recession began in December 2007.

"If this pace is sustained, then it would suggest that November's net job loss of 533,000 was not an outlier but perhaps an indicator of more severe deterioration to come," wrote Andrew Gledhill, an economist for Moody's Economy.com. "What is troubling is that labor market conditions have usually not deteriorated by this much by this early in a downturn."

Typically, state unemployment benefits run out after 26 weeks for those who are eligible. A federal law extends unemployment benefits for an extra 13 weeks under the separate federal program.

Benefits are generally available for those who lose their full-time job through no fault of their own. Those who exhaust their unemployment benefits are still counted as unemployed if they are actively looking for work.

In another economic report Thursday, the Labor Department said import prices fell a record 6.7% in November as imported oil prices fell a record 25.8%.

Separately, the Commerce Department said the nation's trade deficit widened to $57.2 billion in October.

Zollars: Labor Pact Levels Field

YRC Worldwide Chairman, President and CEO William D. Zollars said the money saved by the wage concessions sought from the Teamsters union will level the playing field between his company and its nonunion competition.

"This pretty much wipes out the difference between union and non-union in our industry, in terms of our cost-base," Zollars said in an interview this morning with CNBC.

YRC is seeking a 10 percent wage cut from its Yellow Transportation, Roadway, Holland and New Penn subsidiaries and a suspension of cost of living adjustments. In exchange, Teamsters employees would receive a 15 percent ownership stake through YRC stock. YRC estimates the cost savings from the modifications to the National Master Freight Agreement at $220 million to $250 million annually. A vote on ratification of the agreement by union members is scheduled for later this month.

Zollars said freight levels declined in "double digits" compared with a year ago.

"It's a pretty ugly situation out there. We're just putting ourselves in a position to be able to make it through no matter how bad it gets." (Click here for video)

JC Penney Drops Oak Harbor Freight Lines as Shipper

Move Is Response To Labor Rights Violations

National retailer JC Penney has stopped using Oak Harbor Freight Lines to ship its merchandise in the western United States. This decision comes on the heels of a report by the International Labor Rights Forum, which found that Oak Harbor Freight Lines has violated international labor rights standards. Teamster members employed by Oak Harbor Freight have been on strike since Sept. 22 because of violations of federal labor laws that protect workers' rights, such as coercing and threatening employees, and making unlawful changes to working conditions.

Oak Harbor is a trucking firm headquartered in Auburn, Wash., and is one of the largest regional freight carriers in the Northwest. The report (http://www.laborrights.org/labor-rights/1863) found that:

-- African-American and female replacement employees working at Oak Harbor have suffered discrimination in their work assignments;

-- Oak Harbor's decision to permanently replace its employees was a tactic to interfere with a legitimate union's attempt to bargain a new collective agreement;

-- Oak Harbor hired a subcontractor, Jim Rexroat, who has used unethical and unlawful business practices, including deceptive hiring practices and failing to pay workers the wages they were promised; and

-- Oak Harbor's decision to eliminate health coverage for its retired employees is incompatible with the ethical principles to which the company claims to adhere.

In response to the workers' strike, now in its 12th week, the company unilaterally stopped paying for health care benefits for current workers and retirees.

Other retailers, after learning of the workers' rights violations, also fired Oak Harbor. The retailers include REI, Urban Outfitters and Gap.

"We are pleased that JC Penney has made the socially responsible decision to cease working with a company that has so blatantly violated workers' rights," said Tyson Johnson, Teamsters International Vice President and Freight Division Director. "We will continue to take our message to Oak Harbor's customers and bankers until they stop these abuses. Oak Harbor should be willing to negotiate with our workers in good faith and allow for a dignified retirement."

Wholesale inventories, sales plunge in October

Wholesalers cut back on their inventories in October by the largest amount since the period following the 2001 terrorist attacks while they watched their sales plunge by a record amount.

Analysts predict more grim news in the months ahead as the current recession deepens.

The Commerce Department says wholesalers, the companies in the supply chain between manufacturers and retailers, reduced their inventories by 1.1 percent in October, the biggest cutback since a similar drop in inventories in November 2001.

The inventory decline was much bigger than the 0.2 percent decrease economists expected.

Sales at the wholesale level plunged by 4.1 percent in October, the largest decline on record.

Drivers consider wage cut to aid trucking company

About 80 members of Teamsters Local 397 will be among union members nationwide who will vote on a 10 percent wage reduction as part of economic relief plan for YRC Worldwide Inc., a trucking company.

Local 397 President Ronald Gibbs said union leadership is recommending approval of the plan because of the financial problems faced by YRC Worldwide during the current economic downtown.

The company has lost about 80 percent of its stock market value over the past year. As a result, banks have mandated virtually all of its assets be pledged to cover current debt. That means the company can't borrow more and could face a liquidity crisis in 2009, the union said.

About 40,000 Teamster members are employed at the affected YRC Worldwide units -- Yellow Transportation, Roadway, Holland and New Penn. About 80 truck drivers from Erie and Crawford counties are represented by Local 397.

If approved, the wage reductions will remain in effect until the current Teamsters contract expires in 2013.

In return for the wage concessions, Gibbs said Teamsters members will receive an equity stake in the company. Nonunion employees would receive the same or greater percent reduction in total compensation.

The estimated savings is $220 million to $250 million a year.

Ballots are now being mailed to union members and are to be counted on Dec. 30. The reductions are expected to go into effect Jan. 1.

USF Glen Moore Hires Drivers

USF Glen Moore, the truckload component of YRC Worldwide, is hiring drivers while the rest of the company makes major cutbacks and the Teamsters make concessions in order to preserve jobs in the company's less-than-truckload units.

USF Glen Moore said it is expanding in its national division as well as two of its regional divisions and the team-driver division. The Southeast and Northeast regions are both looking for truckload drivers.

In an ad on the trucking Web site Careersingear.com, USF Glen Moore offered "great miles, great culture and industry competitive mileage rates" along with a benefits package for solo and team company drivers with a year's experience and a hazardous materials endorsement.

Arkansas Best Freight's biggest competitor on brink of bankruptcy

Arkansas Best Freight's biggest competitor is on the verge of collapse, but a deal with the Teamsters union could save 40 thousand jobs. ABF is based in Fort Smith. The Yellow Roadway Corporation is a freight company based in Overland Park, Kansas. facing economic hardship, the company has reached an agreement with union leaders for a 10 percent pay cut across the board. but that doesn't mean the employees won't benefit.

"Through this plan we have created a trust so the members get a 15 percent stake in the company," Teamsters spokesman Brett Caldwell told 5NEWS.

Union employees won't be the only ones tightening their belts. non-union employees will also be asked to make an equal sacrifice. There will be ten percent less in their paychecks. a spokesman for the international brotherhood of teamsters says a similar offer has not been extended to arkansas best freight at this time and the carrier doesn't seem to want one.

This statement was released Friday: "ABF has reviewed the details of the agreement between YRC Worldwide and the international brotherhood of teamsters. We do not believe that agreement is appropriate for our company. We are in the midst of evaluating its impact on our employees, our cost structure and our competitiveness."

Some have speculated that YRC will significantly undercut abf's rates to survive. but Tteamster spokesman Brett Caldwell says that's not the case.

"We want YRC jobs to be protected we want ABF jobs to be protected. In no way would we do this program in order to undercut another union employer."

Caldwell insists that YRC's survival is in Arkansas Best's...best interest.

"If yrc has problems the financial pressure is on ABF as a surviving company for those pension funds would be tremendous."

YRC worldwide teamsters will still have to vote on the contract changes which will likely be approved and take effect January first 2009.

ABF's statement went on to say that they will always act in the best interest of the company and work to ensure the preservation of employee jobs.

FedEx Agrees to Pay $26.8 Million to Settle Drivers Lawsuit

FedEx Corp. has agreed to pay $26.8 million to settle a California lawsuit over whether some drivers were independent contractors or employees.

The agreement, presented in a hearing Friday, requires court approval.

In 2007, the California Appeals Court affirmed a 2004 district court ruling that about 200 drivers who operated in the state six to 10 years ago were employees and therefore entitled to business-expense reimbursement.

Moody's cuts YRC Worldwide's debt rating

Plans by YRC Worldwide to offer to buy back all of its publicly traded debt for an average of less than 50 cents on the dollar prompted Moody's Investors Service on Friday to downgrade the trucking firm's debt ratings.

Moody's took YRC's corporate family rating to "Caa1" from "B1", and cut its probability of default rating to "Ca" from "B1".

The rating outlook is developing, Moody's said.

On Thursday YRC said it would tender to buy back up to $537 million in principal on senior notes issued by it and subsidiary YRC Regional Transportation.

Moody's said the offer amounts to an average of about $475 for every $1,000 in debt.

The ratings service said it "views the tender, which is being offered at a deep discount to par, as a distressed exchange."

If YRC is successful with the tender offer, Moddy's said it will have used nearly all of its bank credit facility, which it will then need to refinance in 2012.

YRC shares fell 13 cents, or 2.4 percent, to close at $5.24 on Friday.

YRC wants to stop supporting non-YRC union retirees

YRC Worldwide Inc., looking for ways to reduce costs, said Thursday that it will seek federal help to eliminate its obligation to non-YRC union retirees.
YRC has had some preliminary contact with officials from President-elect Barack Obama’s administration on the issue of multi-employer pension plans, said Bill Zollars, YRC’s chairman, president and chief executive. YRC would like to stop supporting retirees from companies no longer in business.

“It’s really the treatment for the orphans that we’re concerned about,” said Zollars, referring to retirees of trucking companies that have shut down. “We’d like to see the government take on some role in supporting them and leave us to fund our own retirees’ pensions.”

Zollars’ comments came a day after Teamsters leaders gave tentative approval to a 10 percent wage cut that could go into effect in January. About 40,000 YRC union workers are eligible to vote on the proposal — which essentially swaps pay cuts for a potential equity stake in the company — by the end of the month.

YRC also has agreed to cut the wages and benefits of all non-union employees as part of the deal with the Teamsters.

Zollars said the company has discussed the pension matter with the Teamsters. YRC is the biggest employer left contributing to the union’s Central States Pension Fund, a multi-employer plan, with about 30 percent of the liability. United Parcel Service Inc. paid $6 billion to leave the fund last year under a new contract.

“The Teamsters and the company are together on this issue,” Zollars said Thursday. “There’s a reasonable chance we can get something done on this with the new administration. We’d love to be able to get it done in the first year.”

A Teamsters spokesman, without specifically addressing YRC’s proposal, said the union supports pension reform.

“Our union believes that anyone that has earned their pension benefits through years of hard work should not suffer impairment of those benefits simply because the employer for which they once worked is now out of business,” said union spokesman Galen Munroe. “We also believe it’s long past time to address the need for serious pension reform to ensure that pension funds will continue to have the resources to fulfill the promises made to their participants and that all working men and women will have a secure retirement.”

Analysts have estimated YRC’s unfunded liability in the Central States fund to be in the range of $4 billion, but Zollars said Thursday that he has not been provided with an updated figure from the fund.

“I’m sure it’s gone up significantly in recent months given what’s happened to the economy,” he said.

Meanwhile, YRC continues to restructure in an attempt to get through the prolonged economic downturn. Zollars estimated the cost savings from the wage cut of the union drivers and dockworkers to be $220 million to $250 million in 2009. An additional $200 million in cost savings should come next year from the merger of YRC’s two biggest carriers, Yellow Transportation and Roadway.

The savings from the 10 percent cutback of wages and benefits of non-union employees will be significant, Zollars said. He added the company may provide a more specific figure later this month.

YRC continues to work on the sale of properties no longer needed due to the merger of Yellow-Roadway and the sale-leaseback of other facilities.

Teamsters may take 10% pay cut

About 40,000 of YRC Worldwide Inc.’s drivers and dock workers will have their wages cut 10 percent under a tentative deal reached with the Teamsters union.

Local union leaders reviewed and approved the proposal at a meeting in Scottsdale, Ariz., Wednesday in an effort to boost YRC’s worsening financial condition.

The proposal will be mailed union members on Dec. 9 and ballots will be counted by Dec. 30, said Bret Caldwell, a Teamsters spokesman.

Caldwell said the proposal includes an “equal sacrifice” provision to slash the wages and benefits of YRC’s nonunion and management employees by 10 percent as well.

Caldwell said the union’s portion of the cutback would just be on wages and not affect benefits.

YRC has union workers at four subsidiaries covered by the agreement: Yellow Transportation, Roadway, USF Holland and New Penn. Several hundred YRC employees in the area work at terminals operated by Yellow, Roadway and Holland.

Private sector loses 250,000 jobs

The U.S. economy shed a quarter-million private-sector jobs in November, according to a payroll processor's report that was worse than economists expected.

Non-farm private employment fell by 250,000 jobs from the previous month on a seasonally adjusted basis, according to the ADP National Employment Report.

The report was expected to show a decline of 200,000 jobs in November, according to a consensus of economist projections compiled by Briefing.com.

"It's impossible to find any ray of light here," said ADP spokesman Joel Prakken in a conference call with reporters. "All of the major industries that we record had declines in employment."

The goods-producing sector lost 158,000 jobs last month, its 24th consecutive month of decline, according to the report. This includes 118,000 positions in manufacturing and 44,000 construction jobs.

The service industry shed 92,000 jobs, its second month of losses since the ADP reports began tracking employment in 2002.

Medium-sized businesses, with between 50 and 499 workers, were the hardest-hit part of the economy, hemorrhaging 130,000 jobs last month. Large businesses, with at least 500 workers, lost 41,000 jobs. Small businesses, with less than 50 workers, lost 79,000 positions.

Prakken said he expected to see "a string of very weak employment reports" going forward. He added that "declines in employment between 300,000 and 500,000 in the coming months would not surprise me."

The ADP also revised its reading for October, to a loss of 179,000 jobs from the previously reported loss of 157,000.

Fuel prices fall but fuel surcharges remain

Flexible fees applied by shippers and airlines are less expensive—and less risky—than purchasing fuel hedges, and most companies have no plans to give them up.

Corporate managers hoping for some relief from fuel surcharges now that oil prices have collapsed can forget it.

The added fees have become standard operating procedure in a number of industries and are here to stay.

Indeed, Morningstar equity analyst Keith Schoonmaker said that the implementation of fuel surcharges, which allow corporations to pass energy costs on to customers, has worked well for airlines, trucking and distribution companies over the past three to four years.

Analysts say the surcharges played a vital role in keeping these businesses alive as oil prices soared to record levels this summer. In fact, Mr. Schoonmaker said in the case of the trucking industry, “It’s really the difference between the relative health of these firms and catastrophe.”

Take FedEx for example. Despite paying an average jet fuel price that was 77% higher than in the previous year, the company managed to post an 8% gain in revenue for its fiscal first quarter in 2009. That’s an 8% increase from last year. Net income, however, did drop to $384 million from $494 million.

By implementing an effective fuel surcharge program, FedEx was able to remain profitable. Fuel surcharges can help produce “a benefit once the fuel prices have leveled off or even decline,” Mr. Schoonmaker said, “so FedEx, UPS and DHL will all have a benefit during these days of declining fuel prices.”

Full Story...........

ABF Eyes Wage Cuts

ABF Freight Systems is warning its workers it may seek the same kind of concessions that competitor YRC Worldwide recently negotiated with its unionized employees.

In an internal memo to employees, ABF President and Chief Operating Officer Wesley B. Kemp said the company is already losing business to non-union carriers, and the YRC wage cuts add that much more pressure to compete in the LTL market.

"If we're going to do anything about this, now may be the best time to act, while we're financially healthy, rather than waiting until we face a crisis," Kemp said in the memo. "We'll be following the YRCW results closely in the coming days and will let you know what we feel is best for our company."

In confirming the memo, David Humphrey, ABF's director of investor relations, noted that ABF employees "do a great job" for the company. "Nevertheless, it is true that the total cost of our wages and fringe (benefits) are higher than many of our competitors. That makes it difficult for us to grow, especially in the current economy. We always welcome the opportunity to talk to the Teamsters about additional ways to improve our competitive position and to preserve Teamster jobs."

YRC Worldwide just keeps on truckin’ despite market’s rough day

Not all local stocks participated in Monday’s Wall Street carnage.

Shares of YRC Worldwide Inc. posted their sixth consecutive gain, rising 14 cents and closing at $4.12, a 3.5 percent gain.

Add that to the five previous trading days, and owners have reclaimed $2.56 a share.

The stock’s continued uptick followed news late Friday that the company and the Teamsters union had agreed tentatively on contract changes aimed at pulling the trucking company through its financial struggles.

YRC has seen the weakening economy cut into shipping demand.

Its credit rating has been slashed, forcing the Overland Park-based company to pledge its remaining unpledged assets as collateral under its credit agreement. The company also is trying to raise $150 million by selling and leasing back a group of its terminals.

Investors bet Monday that management and labor may know how to turn an 18-wheeler more quickly than expected.

TEAMSTERS, YRC WORLDWIDE REACH AGREEMENT ON ECONOMIC RELIEF

Agreement Will Protect Union’s Freight Members’ Jobs, Benefits

Facing the worst economy since the 1930s, the Teamsters Union and the freight companies of YRC Worldwide Inc. (YRCW) have reached an agreement to provide the company with economic relief that will protect the jobs and retirement security of tens of thousands of Teamsters.

“This agreement will help the company get through this deepening recession and protect the jobs and health, welfare and pension benefits of our freight Teamsters,” said Tyson Johnson, Director of the Teamsters National Freight Division. “This is a very difficult time for our members, but this agreement will protect the livelihoods of our members and their families, which is our number one priority.”

The details of the agreement will be discussed on Wednesday, December 3 with leaders of local unions that represent members from the YRCW companies—Yellow Transportation, Roadway, USF Holland and New Penn. If the local leaders approve the plan, Teamster freight members will be asked to ratify the agreement next month. About 40,000 Teamster drivers, dockworkers, clerical employees and others are actively employed at the companies.

“I believe our freight members understand the terrible economic conditions that are battering the trucking industry,” said Jim Hoffa, Teamsters General President. “We are facing the worst economic environment since the Great Depression. We all need to work together to get through this period of uncertainty. This agreement will help protect tens of thousands of our members’ jobs. Failing to act now would be a grave mistake.”

Teamsters - YRC negotiations could affect hundreds of local workers

One of the largest shipping companies in the country is at the negotiation table with the Teamsters, and hundreds of Michiana workers could be affected by what comes out of the talks.

About 350 Michiana workers are employed by YRC Worldwide, which you likely know as the three shipping companies they own: Yellow Transportation, USF Holland, and Roadway.

YRC's CEO Bob Zollars says they're exploring their options with the teamsters, to see how they can help the company through this tough economic time.

“We approached the Teamsters in an effort to explore all available options under the National Master Freight Agreement to ensure competitiveness and preserve the benefits and jobs of our union employees,” Zollars said Tuesday, according to the Kansas City Star.

In a memo sent to local Teamster members yesterday, the organization says, "It is questionable if the company can generate enough money to prevent a prolonged downturn," as the struggling economy may affect their ability to borrow money to pay down debts.

The company is trying to re-negotiate the contract they signed 9 months ago, that gave workers a raise.

The teamsters say they're not negotiating the parts of their contract that include benefits; they're really only talking about the possibility of decreasing their pay.

Local teamsters say some sort of agreement is in everyone's best interest.

“We hope we can keep jobs we just want to come to work every day and take a paycheck so we can feed our families just like you and everybody else,” said Dennis Switzer, a Yellow employee who has worked at the terminal in South Bend for 13 years.

“We're in the middle of a recession. We're in the middle of a huge economic downturn and (YRC), like everyone else, is having some struggles. But they’re working through those struggles and they're going to be fine. They’re going to survive and be competitive,” said Bob Warnock III, President of the Local Teamsters #364.

Meanwhile, investment experts don't expect YRC to go out of business over the next few months.

But they do expect its stock to remain volatile, and it's dropped by about 80% over the last year.

These contract negotiations have been going on since Monday.

YRC is the second largest employer of Teamster employees in the country, and there are about 40,000 union employees nationwide at YRC.

YRC could not be reached for comment Wednesday.

YRC Worldwide will spend as much as $100M to buy back senior notes

YRC Worldwide Inc. will offer starting Tuesday to buy back senior debt for as much as $100 million in cash.

In a release after the market closed on Monday, the Overland Park, Kan.-based company said it will offer to buy back its 5 percent and 3.375 percent contingent convertible senior notes due in 2023 and its 8.5 percent senior notes due in 2010. The company said it had drawn on its senior credit facility to finance the purchases.

YRC said it expects to buy at least $230 million of the notes, which would reduce its debt by at least $130 million. To the extent the principal amount of the purchased notes exceeds the amount paid, the company said it will recognize the difference as a gain on extinguishment of debt and include it in the company’s earnings before interest, taxes, depreciation and amortization under the debt-to-EBITDA leverage ratio in the company’s credit agreement.

“This is another proactive measure that we are taking to reduce our debt and improve our earnings,” Chairman and CEO Bill Zollars said in the release. “Given the deteriorating economic environment, we have implemented a comprehensive program to improve our competitive position, increase our profitability and enhance our financial condition.”

YRC Seeks Economic Relief

The following is a statement from the International Brotherhood of Teamsters, Freight Division:

YRC Worldwide Inc. management has been seeking economic relief in the National Master Freight Agreement for several weeks. Following the recent downgrading of its debt rating by both Standard and Poor’s and Moody’s Investors Service and its impact on the company’s ability to maintain a line of credit, the Teamsters General Executive Board today unanimously agreed to permit representatives from the Teamsters National Freight Industry Negotiating Committee to enter into discussions with YRC immediately to determine how to best preserve Teamsters jobs and protect benefits.

Please go to www.teamster.org for the latest updates on discussions with YRC.

Goods carried by US trucks declined last month

Total goods shipped by trucks in the U.S. fell 3 percent last month, a major industry trade group said, marking the fourth consecutive month-over-month decline.

The American Trucking Associations said Monday its seasonally adjusted tonnage index, which measures the weight of freight hauled by U.S. truckers based on membership surveys, fell to its lowest level in five years in October.

"October should be the busiest month of the year, but instead this October was a fizzle," said ATA Chief Economist Bob Costello. "The latest truck tonnage drop suggests that retailers are very pessimistic for the holiday sales season."

Costello said the accelerated weakening of tonnage in October suggests that shipments in the fourth quarter might be unexpectedly slow as well.

Truckers serve as a gauge of U.S. economy health because they haul about 70 percent of manufactured and retail goods.