Teamster Freight Members at New Penn Approve Job Security Plan

Drivers, Dockworkers Ratify Plan Aimed at Preserving Their Jobs, Benefits

Teamster members at New Penn have overwhelmingly approved a Job Security Plan that provides economic relief to its parent company, YRC Worldwide, Inc., as it tries to recover from a recession that is pummeling the freight business.

In the revote, New Penn members--as well as members covered by all mechanics and office agreements--approved the plan 912-334. In the first vote, New Penn members rejected the plan while a majority of other YRCW employees ratified the plan. About 1,500 New Penn workers were eligible to vote.

"The New Penn local union leaders did a great job explaining the negative
consequences if this revote was not successful," said Tyson Johnson, Director
of the Teamsters National Freight Division. "The New Penn members realized
that hundreds of jobs were at stake in this vote."

The Job Security Plan provides YRCW with over $1.2 billion of cost savings over the remaining 43-month term of the agreement and greatly enhances YRCW's financial position. While the wage reduction and pension terminations are effective immediately, they will not remain in effect unless:

1) YRCW and its bank group amend their loan agreements in order to provide the company with sufficient liquidity and flexibility to complete its restructuring and take advantage of the upturn in freight demand anticipated in 2010; and

2) affiliated Teamster Pension Funds approve the "deferral/termination" arrangement.

The plan calls for a reduction in gross wages of 15 percent from the full
National Master Freight Agreement rates. This includes the 10 percent wage
reduction previously ratified by the membership in January 2009.

Additionally, the plan will allow the company to terminate pension fund contributions effective from July 1, 2009 through December 31, 2010, but employees will not lose accrued benefits or credits previously earned during this period.

The Real Story

This Editorial appears in the Aug. 31 print edition of Transport Topics.

When trucks and truck drivers are mentioned in the general media, they seem almost invariably to be put in a bad light.

Trucks often are portrayed as noisy, smoky, fire-breathing monsters, scaring the daylights out of everyone else as they roar down the highway.

Drivers usually don’t fare much better. They’re frequently stereotyped as reckless cowboys — irresponsible, badly trained and not caring about the safety of anyone else on the road.

That’s why the National Truck Driving Championships are so refreshing. They tell the real story — the story of drivers and of a trucking industry devoted to safety — all celebrated this year in Pittsburgh, where 415 of the best drivers competed in the “Super Bowl of Safety.”

American Trucking Associations has sponsored the national truck driving challenge since 1937, in an event that allows as competitors only those who have been accident-free for a year. Most contestants have records that far exceed that standard. Full Story.......

James P. Hoffa: Happy 'Enlightened' Labor Day

Senate Minority Leader Mitch McConnell said this week that workers in the United States apparently don't want to join unions because of the "very enlightened management in this country now, treating employees better and employees have decided they don't want to pay the dues."

McConnell, R-Ky., husband of the most anti-union Labor Secretary in history, enlightened the rest of the country with his ridiculous reason claiming why no Republican will vote for the Employee Free Choice Act.

To borrow from Rep. Barney Frank, McConnell must spend most of his time on a planet that's much better than the planet the rest of us live on.

In truth, the Employee Free Choice Act is desperately needed on my planet, where 16 workers die on the job every day because managers ignore their health and safety. On my planet, field workers die of heat exhaustion. Laundry workers are killed by dangerous machinery. Exhausted airline pilots die in crashes. Full Story.........

YRC; Facts surrounding the New Penn situation

Taken from YRCW Insight website

There's been a great deal of speculation in the marketplace about New Penn, where employees represented by the International Brotherhood of Teamsters are voting for a second time on the modified labor agreement.

We don't comment on speculation. Here's what we can tell you:

The company has not filed any change of operations affecting the network status of New Penn.

New Penn continues to provide superior regional, next-day transportation services to our customers.

We're proud to announce that New Penn recently won its 16th consecutive Quest for Quality award from Logistics Management magazine.

The bargaining units that haven't yet ratified the labor agreement modifications represent less than 10 percent of our company's Teamsters employees. According to information released by the union, ballots from New Penn employees are due back September 9. We'll provide updated information after the Teamsters release results.

TEAMSTERS CALL FOR INDEPENDENT BOARD CHAIR AT FEDEX; URGE INVESTOR SUPPORT

Teamsters Cite FedEx’s Poor Performance, Oversight Failures

The International Brotherhood of Teamsters today asked shareholders of FedEx Corporation to support the union’s proposal for an independent board chairman at FedEx’s upcoming annual meeting.

In a letter to shareholders, Teamsters General Secretary-Treasurer C. Thomas Keegel said that Frederick W. Smith’s dual role as chairman and chief executive of FedEx has resulted in a CEO-dominated board incapable of providing the rigorous, independent oversight of management that investors require. FedEx’s annual meeting will be September 28 in Memphis, Tennessee.

“FedEx’s lack of independent board leadership, compromised board independence and effectiveness, chronic poor performance, excessive executive pay, and questionable business strategies underscore the urgent need for an independent chairman to lead FedEx’s board in holding management accountable and providing strategic oversight and guidance,” Keegel said.

FedEx has significantly underperformed in the trucking and shipping industries, the S&P 500 Index, and compared to direct competitor United Parcel Service Inc. on a one-year, three-year, and five-year total shareholder returns basis, according to data from The Corporate Library (TCL), a leading provider of independent corporate governance research and analysis. Meanwhile, Smith has raked in exorbitant pay, accruing more than $84 million over the past three fiscal years while shareholder value has fallen by 50.2 percent. Profits made on the exercise of stock option grants with no performance hurdles make up the bulk of Smith’s pay.

The letter also raised concerns that Smith’s controlling influence on a board that includes potentially conflicted and over-extended directors has led the board to rubber stamp an unlawful and unsustainable business model at the company’s second-highest revenue generating business segment, FedEx Ground, which has exposed the company to staggering legal and financial risks.

The FedEx Ground business model, which relies on the misclassification of employee drivers as “independent contractors,” has allowed FedEx to evade expenses like payroll taxes, overtime pay and benefits. Numerous state courts and government agencies have found that FedEx Ground’s contractor model is a sham and are looking to collect the money owed to workers and states. According to an August 2008 Bloomberg article, the pre-tax liability from unpaid payroll taxes alone could reach as high as $2.5 billion.

“Many FedEx shareholders have already joined our call for independent board leadership, with 34 percent of the vote by shareholders supporting the Teamsters’ independent board chairman proposal in 2008,” Keegel said. “We believe that now, more than ever, an independent chairman is necessary for the company to successfully navigate the extraordinary legal, regulatory, reputation- and recession-related challenges facing FedEx.”

Lenders ease YRC Worldwide’s liquidity requirement

YRC Worldwide Inc. and its lenders have finalized another credit agreement amendment, signaling continued support of the trucking giant through financial losses.

Overland Park-based YRC wrapped up the agreement with JPMorgan Chase Bank N.A. and other lenders on Friday, according to a Monday filing with the Securities and Exchange Commission. The agreement maintains a $950 million credit facility for YRC and a senior loan of about $111.5 million, but it suspends until Oct. 13 a requirement that YRC always have liquidity of $100 million or more. It also puts off until Oct. 12 the prepayment of outstanding revolving loans from the proceeds of real estate asset sales; half of any prepayment will increase the revolver reserve amount.

On Aug. 31, the revolver reserve amount was about $100 million; it was not increased by the first $50 million of net cash YRC got from selling real estate since July 30.

The amendment also allows YRC to sell certain property for as much as $400 million in net cash proceeds.

Lenders had to rework credit agreements as a condition of the International Brotherhood of Teamsters’ acceptance of an extra 5 percent pay cut and forfeiting 18 months of pension payments. Most union workers agreed to the concessions early this month.

YRC reported a $309 million loss in the second quarter, coming on the heels of a $257.4 million first-quarter loss.

The company has taken steps that include selling property, integrating subsidiaries, closing facilities, laying off workers and repeatedly amending agreements with lenders in an attempt to maintain liquidity and ride out the recession.

YRC Worldwide's Woes a Benefit to Arkansas Best LTL Unit

ABF Freight System, the largest operating unit of Arkansas Best Corp., is negotiating with the Teamsters unit over wage and pension concessions.

ABF, the nation's sixth-largest LTL company with $1.83 billion revenue last year, operates in the same troubled, unionized, long-haul LTL segment that YRC Worldwide. Financially ailing YRC recently obtained a five-year 15 percent wage cut as well as an 18-month pension freeze, savings that could amount to nearly $900 million a year for YRC.

Full Story........