As U.S. Allied Teamsters may soon be voting on drastic concessions, Allied Teamsters in Ontario and Quebec are standing united, with pensions and wages being key issues.
The next bargaining round is set for early March, but with the report that PTS is buying Allied-Canada, a question mark hangs over the negotiations.
Allied employs about 700 Teamsters in Eastern Canada, more than the other companies—PTS, Cassens, and Gen Auto—combined. PTS has already settled with the Teamsters, for a cheap raise of just one cent per running mile for each of the three years in the contract.
In January the Allied stewards walked out on their union leaders from Toronto Local 938 over the issue of winning the right to elect their pension trustees for the Eastern Canadian car carriers’ pension plan. The stewards on the bargaining committee want that guaranteed in the contract, to protect their pension from a takeover.
The wage issue has not yet come to the table. With Yucaipa’s deep pockets now in the picture, Allied Teamsters are not going to be in the mood to give anything away.
One Allied driver told us “Time is on our side now. We’re not going to settle short, especially with the stewards united.”
Teamsters in the U.S. and Canada are in important struggles to maintain our contracts—it’s time for solidarity of all Teamsters at Allied-PTS. United against concessions on both sides of the border, we all win.
When your union president writes to you that “it may or may not be that some modifications to the contract are necessary,” then sit on your wallet, because someone may be reaching for it. On Jan. 9, Teamster President James Hoffa wrote that to 3,700 U.S. carhaulers who work for Allied. Many more Canadian Teamsters work for Allied, where it is not in bankruptcy.
Any possible concessions agreed to by the IBT would have to be approved by carhaulers in a referendum vote, per our union constitution.
At the same time, the investment group Yucaipa and investor Ron Burkle have been playing an active role in developing a plan for Allied’s future, and also purchased much of PTS’s debt. PTS (Performance Transportation Services) owns three carhaul carriers: Leaseway, E&L, and Hadley. If Yucaipa acquires both companies, the combined operations would include some 70 percent of the unionized carhaul industry.
With Yucaipa possibly ready to take on hauling the majority of all cars in North America, it seems the wrong time to be offering concessions to Allied, which has been struggling for years and operating in bankruptcy for the past 18 months.
Allied is asking the bankruptcy court for an extension of time for its plan to emerge from bankruptcy.
We asked a number of Allied Teamsters why they thought that the IBT leadership might be ready to give concessions at this time. Detroit Allied driver J. D. Jackson summed it up: “The IBT election is over, and the next one is five years away.” Jackson was formerly an International rep and once headed the IBT Carhaul Division. Several other Allied Teamsters told us pretty much the same thing.
Last month, Forbes magazine’s online edition reported: “This spring Yucaipa paid $100 million to buy a controlling stake in Allied Holdings, a trucking outfit in bankruptcy proceedings. ‘(Former President) Clinton got it to the point where Hoffa actually helped us with that deal, something I couldn’t have gotten on my own,’ Burkle says.”
Why would Hoffa help Ron Burkle take over Allied at a bargain price, only to turn around and give Burkle concessions?
Members in the Dark
The International Union is keeping the rank and file in the dark about plans. In Hoffa’s letter, he gives a website address for members to get “the latest information.” Unfortunately, it’s a wrong website address that leads nowhere. When you do find the right address, the latest posting on it is from last June.
We need a plan to save our union in carhaul and organizing to defend this strong union sector, and we need membership involvement to make it work.
Carhaul Contract Under Fire
July 2006 - Allied Automotive Group’s 3,800 US Teamsters got a raise on July 1 when the 10 percent cut imposed by the bankruptcy court expired without being extended. Just as important to carhaulers was the news that Yucaipa Companies, a Los Angeles firm controlled by billionaire investor Ron Burkle, is taking an interest in acquiring Allied.
Allied withdrew its motion in court to extend the 10 percent pay cut for another three months, when their own records showed that they made an operating profit in May and had not drawn on the credit they said they would need to continue.
Yucaipa bought $100 million of Allied debt from Morgan Stanley for about $70 million and is looking to possibly take over Allied. Top management figures have indicated they are hostile to this move; presumably they will be gone along with CEO Hugh Sawyer if Yucaipa does acquire the biggest carhaul company in North America.
Behind the scenes Yucaipa has contacted the Teamsters Union. Burkle is a prominent Democrat and presents himself as union-friendly; this is not the first troubled unionized company he has moved to take over.
Allied Systems, the largest carhauling corporation, is going to court on April 26 to void the contract covering 4,000 U.S. Teamsters and impose a 10 percent wage cut. Management claims that the company will suffer irreparable harm as soon as May if they don’t get the cuts immediately. They are also demanding that the June 1 contractual raise be eliminated.
In mid-April, the company advised all U.S. Teamsters that they anticipate court approval and that they will cut all wages by 10 percent on April 30 if this approval is granted.
The International Union responded by demanding more detailed financial information from the company on its financial status. While a good start, this response seems entirely inadequate to the situation, which threatens to shatter a national Teamster contract.
In a similar situation with the largest auto supplier company, Delphi, the United Auto Workers (UAW) has threatened to strike if their contract is voided in bankruptcy court, and the tactic has brought General Motors into the bargaining picture. GM cannot afford a strike that will interrupt its product flow.
Our union needs a plan to fight back. And the entire labor movement and our allies need to take on this corporate scam, which is already infecting two major industries and could spread to more.
Over 200 Baltimore Jobs Lost
At the end of December Baltimore Local 557 lost over 200 carhaul jobs to carrier New Concept Solutions. Leaseway, now owned by Penske, had operated out of the terminal since 1938. GM refused Leaseway’s request for a rate increase and Penske terminated the contract. Drivers at New Concept Solutions are represented by the machinists’ union. This arrangement has popped up elsewhere. The presence of what is basically a company union poses just as big a threat to the unionized carhaul industry as does nonunion competition.
It appears that Hoffa’s power and prestige mean little within the AFL-CIO if the IBT is unable to stop another union from raiding one of its core jurisdictions.
More Lost Jobs in N.Y. and Mo.
Nearly as many Teamsters worked out of Selkirk, N.Y., at one time. They also received an unwanted Christmas present when Allied closed its terminal at the end of December.
In Missouri, Teamster jobs were lost to nonunion competition even before Ford’s recent announcement that the Hazelwood plant would be closed.
Allied is also using the current climate to push for concessions. Brokers out of Boston Local 25, for example, are under the gun. Allied has told them that they will have to eat whatever concessions are needed to keep the Volkswagen traffic — or lose their jobs.
Norfolk, Va., one of the few terminals in the East to resist concessions, has now been strapped with the flex workweek.
Mechanics Oppose the Flex
In the Midwest, Allied is maneuvering to get the flex workweek for mechanics. Some locals appear to be helping Allied’s efforts by repeating the lie that other locals have already accepted the flex. Fortunately, stewards are actively in touch with each other and can overcome this trick.
Conditions in driveaway [see related article] are just as difficult.
Aggressive Steps Needed
Some local unions are grumbling about the International’s lack of action, wondering when real steps (rather than PR) will be taken to address this growing problem. At a recent Detroit Local 299 meeting, members suggested that carhaul locals put together their own network.
What will come of this, or of the International’s position, is not clear.
What is clear is that hundreds more Teamster jobs are down the dumper, with more to come if aggressive steps are not taken.
The International has rejected the deal; there is no way it could be accepted. Other carriers would immediately demand equal treatment, and any mid-contract concession must be voted on by members in a national referendum. Granting the freeze on health and welfare contributions would force carhaulers out of their benefit plans and into second-tier plans.
What is Allied Really After?
Allied claims that these concessions are needed to help the financially ailing company, and to deal with the growth of nonunion carriers, which are concerns on the minds of Allied’s employees.
Management is playing on the fear of employees; no one wants to lose their job. The program is endless: CDs mailed to every Teamster, conference calls, letters, and even one-on-one meetings to go around our union and probe our weak spots. Management is manipulating fear more effectively than they are moving automobiles.
Are they simply trying to soften us up for next year’s contract? Or setting up the union to take the blame for the company’s problems?
One thing is certain: concessions will not save jobs or make them secure. Job security comes with a strong contract and a union that has a plan to defend our jobs and to aggressively organize the whole carhaul industry.
Vascor is a growing logistics player in the auto industry and already operates some off-site yard operations in carhaul. In a letter from Allied’s labor relations department to IBT carhaul director Doc Conder, Allied says Vascor intends to open nonunion, but that they are “not adverse to Teamster representation.”
Teamsters from a number of the GM locations report that they have not heard one word from the International union, and some local union officers report that they can’t find anything out from the International either.
Has the union met with Allied about these jobs? Has Allied opened their books so the union can see the economics of the situation? Has Vascor been approached about accepting the experienced TSI/Allied workers, and the union contract? What is the plan to organize Vascor, and to protect the jobs and pensions of the affected Teamsters? Is there any plan at all?
Our union has given plenty of goodies to Allied management, including a wage freeze. It’s time to call in the favors and protect the jobs of a lot of Teamsters.
Carhaul Companies, Union Both Need to Change
Billy Scott, now driving for Allied and a long-time union rep for Detroit Local 299, made the following observations in a letter to carhaul friends:
The union carhaul carriers can't see the forest for the trees. They are unwilling to take on the nonunion sector. More importantly, they are unwilling to take on the manufacturers. They continually want to beat up on the union for letting this happen to them, while they continue to give these nonunion operations footholds into their business.
Allied is the prime example: Allied is content to let the nonunion entities chip off, piece by piece, segments of their operations. They would rather a nonunion carrier get their work than one of their union competitors.
The Teamsters Union leadership has written this 10,000 member division off. They give it a lot of lip service, but provide little or no resources to actually go after these non-Teamster companies. They say that the Local Unions should do it. I know of no Local Union with the resources to take on a full blown organizing drive, not even for a small company, let alone an operation like Fleet Car, United Road Service, Swift, BMW or Waggoneer.
This attitude on the part of the union leadership has to change, and rank and file carhaulers have to make it happen, and participate in that organizing.
Active Takes 300 Teamster Jobs: Local 654 Sues
Over 300 Teamster carhaulers in Springfield,Ohio lost their jobs May 1 when their work hauling Navistar trucks was transferred from Active Transportation to Auto Truck Transport. Both Active and ATT are owned by JHT Holdings. ATT – whose workers are represented by the International Association of Machinists (IAM) – pays $620 per month in pension and health & welfare benefits. Active pays $1,760.
The job losses are particularly hard to swallow because in May 2003 the Teamsters agreed to a two-year wage freeze in carhaul to offset rising health care costs.
JHT’s CEO, Dennis Troha, has also used the same scam in other parts of the country to whipsaw Teamster carhaulers into accepting lower benefits or losing work. JHT’s subsidiaries haul more than 70% of the truck tractors made in the U.S. and Canada. Teamster Local 654 has sued in federal court to stop the Springfield work transfer, arguing that it was done solely to avoid paying pension and health & welfare benefits. The International union has not mounted a campaign to save Teamster driveaway jobs.
Allied’s CEO Hugh Sawyer dropped a hint (or a threat) into his February 1 letter, now distributed widely to Allied Teamsters, by mentioning the possibility of bankruptcy. If Sawyer attempts to use bankruptcy court as a weapon to attack our contract, we need to be prepared for an all-out fight. Not just Allied Teamsters, but all Teamsters.
Sawyer claims in his “Dear Jimmy” letter that a silent majority of Allied Teamsters support his drive for concessions. Sawyer, a master of salesmanship and paternalism, often claims to speak for his Teamster employees.
Allied — along with the whole industry — was given a two-year wage freeze in the current contract, and the June 1 raise will be the first one three years. In his February 18 response, Conder states that other union carriers are making money and declines Sawyer’s request for a commission to discuss concessions in wages and working conditions.
Allied continues to be its own worst enemy. For example, in February Allied has lost some Ontario Chrysler work to a non-union operator, Oakwood Transport, for no apparent reason. Allied can’t seem to handle all the Chrysler traffic, and yet has drivers on lay-off in Windsor, Ontario.
Auto Truck Transport (ATT) drivers across the country will soon get a chance to vote to become Teamsters. In mid- September the NLRB issued the election decision for 1,300 drivers in a nation-wide unit.
ATT is controlled by Dennis Troha, the CEO of Active Transport, which is covered by our national carhaul contract. ATT was created a decade ago as a union-busting device, and Troha has been able to evade the language against double-breasting in the contract.
Management has used ATT to underbid Active and throw Teamsters out of work in more than half a dozen cities. Active and ATT together transport the majority of heavy trucks made in the U.S. and Canada, as well as those made in Mexico and moved by ATT out of Laredo.
ATT workers will have the chance to end this division and improve their benefits and conditions. The Teamsters are competing against the International Association of Machinists (IAM). Unfortunately, the IAM has allowed itself to be used by management in their campaign to bust the Teamster contract.
Carhaulers can help by volunteering on the Teamster campaign or by talking to ATT drivers to support the drive.