YRC and Teamsters Meet, More Concessions Expected from Union
On Tuesday officials with the parent company to several trucking operations, YRC Worldwide, met with representatives of the Teamsters Union in Dallas to update them on the company's most recent performance, future prospects and corporate refinancing opportunities.
Evan Lockridge・Former Business Contributing Editor
November 7, 2013
2 min to read
On Tuesday officials with the parent company to several trucking operations, YRC Worldwide, met with representatives of the Teamsters Union in Dallas to update them on the company's most recent performance, future prospects and corporate refinancing opportunities.
In an announcement, YRC said it is the company's intent to engage in formal negotiations and extend its current contract with the union.
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"Reaching an understanding would be a positive and important step in the future of this company. In addition to securing the jobs of over 26,000 union employees, it will substantially increase the likelihood of a holistic refinancing solution to address the debt maturities in 2014 and 2015,” said YRC Worldwide CEO and YRC Freight president James Welch.
As a result YRC Worldwide has postponed its third quarter 2013 conference call Nov. 7 to Nov. 12, and earnings will be released the same day, after the closing of the market.
YRC’s contract with the Teamsters expires in 2015 but it has more than $1 billion dollars in debt, with much due before then.
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In a letter to the Teamsters ahead of the meeting Welch said, ““Our lenders have made it clear the combined company needs to be performing better than it is today, and that we need a labor agreement with our Teamster employees that extends beyond our current expiration and any new debt maturities, and increases our competitiveness, before any refinancing can be completed.”
While no official word has come from this week’s meeting, the Kansas City Business Journal reports it talked with one Teamster official who was there and told the newspaper YRC is asking the Teamsters to extend existing concessions with the company for five more years. He described the meeting as cordial but that leaders of other local unions were “very upset” to hear the company is asking for additional concessions, according to the paper.
The current labor pact was negotiated in 2010, when the Teamsters agreed to a 15% wage cut. In 2009 and 2011, YRC had to rework its finances to avoid bankruptcy.
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