Union employees could receive ballots on wage cuts, company offer by next week
Teamsters at YRC Worldwide’s motor carriers will begin to receive ballots as early as next week for a vote on a plan to steer the troubled carrier clear of bankruptcy.
If the process runs smoothly, YRC and the Teamsters could seal their deal as early as the first week of August.
The Teamsters union and the less-than-truckload carrier group agreed July 9 to swap wage and pension cuts for a greater union say in running the company. The agreement would save the company $45 million a month in 2009 and $50 million a month in 2010, totalling more than $800 million.
Actual savings would be higher, as the wage cuts would stay in place until the current contract expires in 2013.
The agreement would give the Teamsters a seat on YRC’s board of directors and the option to purchase up to 35 percent of the $9 billion company.
It also would allow the union to impose restrictions on future acquisitions, offshore labor and the use of YRC’s third-party logistics subsidiary.
In return, the Teamsters would accept a 15 percent wage cut for the life of their master contract, along with an 18 month cessation of contributions to union pension plans.
The ratification vote could be a tough fight for the company and the union. YRC Teamsters agreed to a 10 percent wage cut in January — this tacks another 5 percent.
The loss of the pension contributions may be the toughest pill to swallow, especially for older drivers near retirement age.
“I think it will pass, but not with as big a margin as the last vote,” one YRC driver familiar with the plan said. “A lot of guys are really concerned” about their pensions, but also about what would happen to the company if the plan were voted down.
The company’s union employees approved the first round of concessions earlier this year by a 72 percent majority.