Chicago YRC Teamsters Again Reject Concessions

December 9, 2009. Chicago freight Teamster have once again rejected YRCW management’s second round of concessions. In voting held yesterday at four Chicago area YRC and Holland terminals, the 1,500 Teamsters (Local 705 city drivers and Local 710 dockworkers) rejected the proposal.

Local 705 drivers voted heavily No, 234 to 132, and Local 710 dockworkers narrowly rejected the deal, 337 to 319. It was the third time Local 710 rejected the same proposal over the past four months.

During the first week of December, Tyson Johnson and Pat Flynn (International vice president and Local 710 secretary treasurer) worked the terminals hard, aiming to convince and threaten Teamsters to vote Yes.

They were met with hard questions and considerable outrage from Teamsters fed up with a union leadership that only knows how to sing the corporate theme song. Chicago Teamsters, like others, are also very concerned about the future of YRC.

Tyson Johnson, Hoffa’s Freight Director, issued a statement expressing “disappointment” with the results and saying he will “await the company’s response.” That seems to sum it up: the IBT leadership sits back and waits to see what management will do next.

YRCW Announces Progress on Debt Reduction

Also yesterday, YRCW released a statement extending the deadline by one week for its lenders to accept a debt-for-equity swap that hopefully will reduce the company’s debt by $537 million. So far, lenders with 72% of corporate debt have signed on, the company reports.

Takeover of Contracts

Locals 705 and 710 have historically bargained contracts independently of the International. Local 705 has included stewards on the bargaining committee, and Chicago contracts are considered superior to the national master freight agreement.

In November, Hoffa shocked the members by abolishing those contracts in mid-term, without a membership vote or any approval by Local 705. This power grab was Hoffa’s reply to the members’ rejection of his concession proposal. Teamsters are not going to sit still for it.

Background to YRCW Problems

Some of YRCW’s problems are self-inflicted, as well as a result of the worldwide recession. But ten years of weak IBT leadership have made the situation much worse.

The IBT held secret negotiations with UPS in 2006 which led to a deal to unionize UPS Freight, the former Overnite, with a contract that lacks Teamster pensions, and a deal to allow UPS to quit the Central States Pension Plan.

That UPS pull-out almost doubled YRCW’s withdrawal liability to the pension fund, carried on the books as a debt. And it gave UPS Freight a big competitive advantage.

The deep concessions have helped YRCW, but in a limited way. Their nonunion competitors have all cut wages in response. ABF, covered by the NMFA, has managed to hold onto its freight, despite the $11 per hour differential in benefits and wages.

YRCW management reports that if freight volume picks up in 2010, they are in position to survive and profit. Many thousands of Teamster jobs and pensions hang in the balance.

What do you think? Click here to contact the TDU Freight Committee.

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