Friday, June 05, 2009

Teamsters union may modify agreement with YRC

The International Brotherhood of Teamsters union said on Friday it was forming a committee to determine whether it should modify its national freight labor agreement to help trucking firm YRC Worldwide Inc weather the current industry downturn.

The move was a response to YRC's request to defer pension contributions to preserve cash, the Teamsters said. YRC is the No. 1 U.S. trucking company.

"We are forming this committee to review the contract in efforts to help YRCW survive this recession and hopefully come out stronger than ever," Jim Hoffa, Teamsters general president, said in a statement.

Union members would have to approve any proposed changes to the Teamsters' national freight agreement.

YRC, which has been shedding jobs and closing facilities to cut costs in the face of the U.S. recession, faces an estimated $2 billion in pension obligations over the next four years.

Last month, the company said it would seek $1 billion in bailout money from the Troubled Asset Relief Program to help it cover pension obligations, a move analysts said was unlikely to succeed because the company has no financial charter.

In April, YRC received approval from its creditors to use real estate as collateral for the $30 million to $35 million a month the company says it needs to pay to meet its pension obligations.

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