YRC's Long-haul Unit And 2 Key Regional Units Could Go Out Of Business If Unionized Workers Vote Down A Tent. CBA

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Marc Lee's Comment
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Less-than-truckload (LTL) carrier YRC Worldwide’s (NASDAQ:YRCW) long-haul unit and its two key regional units could go out of business by the end of May should unionized workers vote down a tentative five-year collective-bargaining agreement early next month, the head of the Teamsters union’s freight division has warned.

Ernie Soehl told the rank-and-file on a nationwide conference call on the evening of April 10 that customers will pull their freight from the three units should members vote down the contract on May 3, the date when the results are to be announced. If customers react in such a manner, long-haul carrier YRC Freight and regional carriers Holland and New Penn Motor Express will likely not last until May 31, the date a two-month extension to the existing agreement is set to expire, Soehl said.

YRC’s shippers are closely monitoring the status of the contract talks, Soehl said. Should the tentative agreement be rejected, “it is my personal opinion, and the opinion of the (negotiating) committee, that we will not make it to May 31,” he said. Shippers threatened to pull business in the days leading up to the tentative agreement at the end of March, and some accounts have already defected, Soehl added. The extension was designed to keep the business stable while the rank-and-file reviews the proposal and votes on it.

Soehl’s blunt assessment means that for the third time in less than a decade, YRC’s unionized workers will vote on an agreement as if the company’s fate depended on it. In 2010, faced with the strong prospects of YRC going out of business, the rank-and-file ratified a contract calling for punishing pension cuts and 15 percent wage reductions. Then in 2014, the members approved a memorandum of understanding (MOU) which effectively extended the terms of the 2010 agreement, although it did call for wage increases, albeit off the reduced base. The members rejected management’s first proposal, leading the company to warn that there “was no plan B” and that liquidation could be the result of a “no” vote. YRC’s lenders had conditioned future financing latitude strictly on a successful extension of the 2010 compact.

Now the threat of a contract rejection leading to the company’s dissolution comes from the union’s leadership. A rejection would be tantamount to the members authorizing a strike against YRC, Soehl said. But a strike would likely never come to pass because there would be no business left by the time a walkout took place, he added.

Neither YRC nor a spokesman for the union’s freight division responded to requests for comment.

About 24,000 Teamsters are employed at YRC, according to company estimates. (other estimates put it as high as 30,000 members. That includes members in a fourth unit, Reddaway, which is governed under a separate labor contract. YRC is one of the last – and the largest – truckers that were part of the once-mighty Teamsters’ freight division. At its peak prior to deregulation in the late 1970s, the division boasted more than 500,000 members. Since truck deregulation occurred in 1980, mergers, bankruptcies and the advent of non-union carriers have decimated the union contracts. The division has around 50,000 members today.

The contract proposal, which has received near-unanimous backing from local leaders, calls for a $4 per hour wage increase for most workers, spread out over five years, with a $1 per hour increase that would be effective immediately. The contract would be retroactive to April 1, 2019. That translates to an 18 percent increase for most workers over the contract’s life. The contract eliminates the current MOU, and no longer pegs wage increases to the lower thresholds. “A dollar is a dollar, not 85 cents,” Soehl said on the call.

YRC agreed to increase its annual contributions to the members’ health and welfare fund. The current pension levels would remain the same; the 2010 agreement froze pension contributions for a couple of years and resumed them at about 25 percent of prior levels.

The proposal restores one week’s paid vacation for workers that had earned four weeks vacation or more. That concession was made in 2010 and extended in the MOU. All unionized workers will get the additional one week’s pay, which will add 14,000 hours of pay per year, Soehl said.

The agreement establishes a class of non-Commercial Driver License driver who would handle local cartage rather than having YRC contract out the work to a non-union vendor. It also protects the higher wage for a CDL driver performing non-CDL driver functions. The pact prohibits the use of autonomous vehicles or drones for transporting freight. It allows, for the first time, the Holland regional unit to use purchased transportation, but caps the utilization to 8 percent of Holland total annual miles driven. It also empowers union negotiators to unilaterally curb or eliminate the purchased transportation programs at Holland and YRC Freight, where it has been in effect, on a limited scale, for five years.

Soehl said the union has extracted all the financial juice it could squeeze out of Overland Park, Kansas-based YRC. The company, Soehl said, doesn’t have another penny to spend beyond what it has agreed to in the five-year pact.

CDL:

Commercial Driver's License (CDL)

A CDL is required to drive any of the following vehicles:

  • Any combination of vehicles with a gross combined weight rating (GCWR) of 26,001 or more pounds, providing the gross vehicle weight rating (GVWR) of the vehicle being towed is in excess of 10,000 pounds.
  • Any single vehicle with a GVWR of 26,001 or more pounds, or any such vehicle towing another not in excess of 10,000 pounds.
  • Any vehicle, regardless of size, designed to transport 16 or more persons, including the driver.
  • Any vehicle required by federal regulations to be placarded while transporting hazardous materials.

Shipper:

The customer who is shipping the freight. This is where the driver will pick up a load and then deliver it to the receiver or consignee.

Regional:

Regional Route

Usually refers to a driver hauling freight within one particular region of the country. You might be in the "Southeast Regional Division" or "Midwest Regional". Regional route drivers often get home on the weekends which is one of the main appeals for this type of route.

LTL:

Less Than Truckload

Refers to carriers that make a lot of smaller pickups and deliveries for multiple customers as opposed to hauling one big load of freight for one customer. This type of hauling is normally done by companies with terminals scattered throughout the country where freight is sorted before being moved on to its destination.

LTL carriers include:

  • FedEx Freight
  • Con-way
  • YRC Freight
  • UPS
  • Old Dominion
  • Estes
  • Yellow-Roadway
  • ABF Freight
  • R+L Carrier

DWI:

Driving While Intoxicated

Marc Lee's Comment
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Bonus post: I was able to recover my long entry after I thought I lost it by hitting the "Menu" button!

Bruce K.'s Comment
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If Jimmy Hoffa was alive today, he’d turn over in his grave.

Marc Lee's Comment
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If Jimmy Hoffa was alive today, he’d turn over in his grave.

I get the point. Though, of course, there ain't no grave 'cause they never found the body!

Daniel B.'s Comment
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Or they can go to OD and make 30$ per hour and not deal with this union crap

Navypoppop's Comment
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It seems like another of the "Big Great Freight Companies" is about to be eliminated. It was just a matter of time. When CF disappeared Conway grew by leaps and bounds until it was consumed by a foreign giant XPO. Overnite got taken over to benefit UPS's entry into the freight business. As stated previously you can work for Old Dominion or Southeast and make as much or more than a union company. I am retired but still have my withdrawal card from when the union jobs were everywhere. The great Teamsters is only a shell from what it was.

SAP:

Substance Abuse Professional

The Substance Abuse Professional (SAP) is a person who evaluates employees who have violated a DOT drug and alcohol program regulation and makes recommendations concerning education, treatment, follow-up testing, and aftercare.

Bobcat_Bob's Comment
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In 2010 my dad was with Con-Way they called him on a Saturday and told him to pack his bags, there was a strong rumor YRC wouldn't open on Monday.He was supposed to travel to their terminals and inspect their equipment to see if anything was worth buying. Obviously it never came to be at the time and the feeling has been YRC has been kicking the can down the road since.

Personally this is why we both like OD, we get paid and treated well without the union headaches.

Terminal:

A facility where trucking companies operate out of, or their "home base" if you will. A lot of major companies have multiple terminals around the country which usually consist of the main office building, a drop lot for trailers, and sometimes a repair shop and wash facilities.

DAC:

Drive-A-Check Report

A truck drivers DAC report will contain detailed information about their job history of the last 10 years as a CDL driver (as required by the DOT).

It may also contain your criminal history, drug test results, DOT infractions and accident history. The program is strictly voluntary from a company standpoint, but most of the medium-to-large carriers will participate.

Most trucking companies use DAC reports as part of their hiring and background check process. It is extremely important that drivers verify that the information contained in it is correct, and have it fixed if it's not.

Bruce K.'s Comment
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OD pays all it’s drivers hourly? And do they have regular OTR jobs?

OTR:

Over The Road

OTR driving normally means you'll be hauling freight to various customers throughout your company's hauling region. It often entails being gone from home for two to three weeks at a time.

Bobcat_Bob's Comment
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P&D gets hourly, linehaul such as myself get mileage my dad is a shop manager do he is salary. I started at 55 cpm and after 1.5 years am at 65 cpm, in September I will be top scale which is around 70 cpm. Hourly pay started at $25 a hour and has 6, 12 and 24 month pay raises to put you at $30 a hour. Plus we get 2 cpm and a $1 a hour pay raise every year.

P&D:

Pickup & Delivery

Local drivers that stay around their area, usually within 100 mile radius of a terminal, picking up and delivering loads.

LTL (Less Than Truckload) carriers for instance will have Linehaul drivers and P&D drivers. The P&D drivers will deliver loads locally from the terminal and pick up loads returning to the terminal. Linehaul drivers will then run truckloads from terminal to terminal.

Linehaul:

Linehaul drivers will normally run loads from terminal to terminal for LTL (Less than Truckload) companies.

LTL (Less Than Truckload) carriers will have Linehaul drivers and P&D drivers. The P&D drivers will deliver loads locally from the terminal and pick up loads returning them to the terminal. Linehaul drivers will then run truckloads from terminal to terminal.

CPM:

Cents Per Mile

Drivers are often paid by the mile and it's given in cents per mile, or cpm.

Bobcat_Bob's Comment
member avatar

Opps forgot, as for regular OTR jobs we have teams and what they call "wild drivers" who are out usually for 5 days then get 2 days off which may or may not be a weekend. You do it a day cab so OD puts you in a hotel every night.

OTR:

Over The Road

OTR driving normally means you'll be hauling freight to various customers throughout your company's hauling region. It often entails being gone from home for two to three weeks at a time.

Day Cab:

A tractor which does not have a sleeper berth attached to it. Normally used for local routes where drivers go home every night.

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