Monday, December 13, 2010

Less Than Truckload Freight Giants In Union Conflict

Court Date Looms for Wage Deal Disagreement
Shipping News Feature

US – The ongoing strife and struggles for survival in the less than truckload (LTL) sector continue despite an upturn in traffic since the market bottomed out. Just last month we detailed the further cuts to be made by YRC Worldwide and how the delicate state of negotiations between the freight and logistics group and the Teamsters Union was under pressure after significant cuts in pay and conditions were accepted by the workforce to enable the company’s survival.

At the beginning of November, another major LTL supplier, ABF Freight System Inc. announced their intention to launch legal action against the International Brotherhood of Teamsters (IBT) and other parties including several YRC Worldwide subsidiaries for, as they saw it, violating the National Master Freight Agreement (NMFA), the collective bargaining agreement covering most unionized trucking employees in the country. They pointed out that YRC had announced that the reduction in costs from wage, benefit and work rule changes agreed by the Union was expected to save YRC $350 million per annum.

ABF employ more that 8,000 union staff and maintain that the agreement gives YRC an unfair advantage over any competition and have actually set up a website to air their grievances and advise of the progress of the lawsuit, due to be heard in the U.S. District Court for the Eastern District of Arkansas on 16th December. In response to the lawsuit the Union have launched their own dispute website on which they maintain the suit is ‘frivolous and without merit’

Now the hearing is due ABF have apparently alleged that, during discussions with the Teamsters whilst attempting to negotiate a similar arrangement as that agreed with their competitors, the Union suggested that ABF took control of the YRC operation, and intimated that contract changes might then be forthcoming. Subsequently YRC union members agreed to extending the preferential terms of employment, cutting wages by 15% up to 2015 and temporary suspension of pension contributions, to enable the company to attempt to return to profit.

This conflict is hardly unexpected, back in September last year we detailed how most of the major LTL carriers felt there was oversupply in the market and that there would necessarily be casualties.

To trace the history of this unfortunate conflict, readers can type YRC into the News Search Box at the top of the page.