YRC Worldwide Inc. wants a five-year extension of its labor contract with the International Brotherhood of Teamsters, the labor union confirmed during a Monday conference call with its local leadership.
It's unclear what else — if anything — the Overland Park-based trucking company (Nasdaq: YRCW) wants in the negotiations with the union that represents more than 25,000 of YRC’s 32,000 employees.
On Tuesday, the Teamsters for a Democratic Union — a dissident group within the union — published details from a conference call between leaders of local unions and the Teamster’s National Freight Industry Negotiating Committee.
That report said the company seeks more “flexibility” but did not provide specific demands. Vic Terranella, president of Kansas City’s Teamsters Local 41, was on the conference call. He confirmed that little happened on the call.
“Really nothing happened,” he said. “There were no specifics that were shared with us.”
Terranella said the company seems more relaxed now that the union is sitting down to talk about an agreement. He noted that the Nov. 15 deadline the company shared with the union when the two sides met earlier this month in Dallas passed with little fanfare from YRC. The company has said that it has $1.4 billion in debt payments coming due in 2014 and 2015 and that a new deal with the Teamsters is crucial to paying those debts.
There should be further conference calls as the two parties continue to meet, Terranella said. YRC’s next big deadline is Feb. 15, when a $69 million payment comes due. No time lines or additional deadlines were announced during the call, he said.
The Teamsters’ national office in Washington has declined to comment on the negotiations. Representatives of YRC typically do not comment on ongoing negotiations, either.
YRC seeks an extension or an amendment to its current contract with the Teamsters. The two parties' current contract runs through March 2015. YRC has told the union it needs to extend the life of that contract into 2019. The company said an agreement is necessary for it to pay debts incurred under the watch of former CEO Bill Zollars.
The existing labor agreement is based on three rounds of concessions the company and the union agreed on between 2008 and 2010. The union consented to a 15 percent cut in wages, suspension of pension payments and reduced vacation time for members. YRC began to make pension payments again in early 2012 at 25 percent of the rate paid in 2009.
The deal saves YRC an estimated $350 million in labor costs annually. It also gave Teamster employees stock in the company and granted the union the right to nominate two members to the YRC board.
YRC reported its third-quarter earnings on Nov. 12. CEO James Welch said the company was not pleased with the results. The market apparently isn't either. About 2:30 p.m. Wednesday, YRC’s stock price had sagged to $7.30 a share from $10.22 at market open on Nov. 12.