July 17, 2009: The ballots for the tentative agreement on economic concessions between the International Union and YRC are being mailed to some 50,000 Teamsters. They face a huge decision, for themselves and their families, and for our union in the freight industry.
YRC Teamsters, who voted in January to accept a ten percent wage cut, are being asked to approve additional big concessions. The new agreement contains an 18-month pension contribution termination period, an additional five percent wage cut, and a small reduction in the employer health and welfare contributions.
If approved in a membership vote, the additional pay cut (approximately $1.16 per hour) will go into effect immediately; the pension termination period will begin July 1 and end December 31, 2010; and the contractual health and welfare contribution increase due on August 1 will be reduced to 20c per hour.
The temporary pension termination is the biggest item, a cut of $7.60 per hour in pension contributions for the first year of the 18 months, and $8.20 for the latter part of 2010.
With 32,000 Teamsters working, the 18-month pension termination would save YRC about $772 million. The 15% pay cut (previous 10% cut plus additional 5% cut) would save YRC about $290 million per year. The union hired experts from MergeGlobal to review YRC’s finances, and they report that this level of relief is necessary to save the company.
With this agreement in effect, YRC would have a labor cost advantage over ABF of over $11 per hour. ABF management is now clamoring to get some concessions of their own.
Counting of ballots is scheduled to begin on August 6.
The union gained an appointee to the YRC board of directors, a corporate turnaround expert in place at YRC, and the ability for members to obtain more stock options.
Additionally, some of the job protections put forward by Teamsters for a Democratic Union (TDU) were added to the tentative agreement: extending recall rights of laid-off Teamsters to 10 years; return of Teamster office work that was subcontracted to India; improved “card check” rights to make it easier to organize nonunion units; and some limit on work subcontracted out through YRC Logistics. Unfortunately the diversion of work to YRC Logistics is referred to as “alleged” in the proposal (section 14).
Click here to see the full text of the tentative agreement.
What do you think? Click here to send your comments.