YRC Worldwide expects union vote results Friday

Results of a union vote that will play a key role in YRC Worldwide Inc.’s future are expected Friday afternoon.

In a Thursday memo to freight local unions, Tyson Johnson, freight division director for the International Brotherhood of Teamsters, said an overwhelming number of ballots were cast regarding the concessions, meaning sorting would continue Friday morning, with a result announcement likely in the afternoon.

The concessions, the second proposed this year, include forfeiting 18 months of pension payments — which would not have to be repaid — and taking an extra 5 percent wage cut to save the trucking giant at least $45 million a month. YRC offered considerations such as options for an additional 20 percent stake in the company and a union-appointed board seat.

In a July 30 conference call, YRC executives expressed confidence in a positive outcome. Chairman and CEO Bill Zollars called it a “game-changing event” for YRC.

“All eyes now are on the Teamsters,” Jason Seidl, a Dahlman Rose & Co. LLC analyst, said in a Wednesday interview. “If this doesn’t happen, there is no Plan B. B probably stands for bankruptcy.”

In January, workers approved a 10 percent wage cut and were offered a 15 percent stake in YRC.

If the union concessions pass, then bondholders and lenders will have to do their part, and YRC will have to win back some of the business it lost, Seidl said Wednesday.

Last week, YRC reported a $309 million loss in the second quarter. The company has taken steps that include selling property, integrating subsidiaries, closing facilities, laying off workers and amending agreements with lenders in an attempt to ride out the recession.

YRCW Ballot Count

The Independent Election Supervisor has announced that due to an overwhelming number of ballots cast, the YRCW ballot count will not be completed until Friday, August 7, 2009.

The ballots are currently being sorted according to Local Union number and company. The balloting process will resume Friday morning with results expected to be announced Friday afternoon.

Results of the balloting process will be posted on www.teamster.org

IBT Readies Ratification Ballots for YRC Teamsters

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.