Yellow: Teamsters’ ‘obstruction’ during talks led to freeze on pension payments

Yellow Corp. is withholding approximately $50 million in pension contributions to the Teamsters Central States pension fund because it says Teamsters’ leadership is causing “obstruction” to the company’s major change of operations.

导致什么黄色的calls a “liquidity crisis” and the need to implement cash-conservation measures, including its benefit funding deferral request.

Yellow, which controls about 8% of the $58 billion less-than-truckload (LTL) market as the third-largest player in that sector, says the Teamsters’ threat of a strike would be illegal and a violation of the collective bargaining agreement, which doesn’t expire until March 31.

Yellow has filed a complaint in its District of Kansas lawsuit against the Teamsters. It says the union’s actions are the “direct cause” of Yellow’s inability to make contributions to the funds.

In June, Yellow wrote to the funds, requesting a short-term deferral of its obligation to pay contributions for two months, July and August, with interest. Yellow says this request is not without precedent.

“Regrettably, the Board of Trustees of Central States refused Yellow’s request, despite the funds’ healthy reserves,” the company said in a statement.

Even more regrettably, Teamsters General President Sean O’Brien has blamed Yellow for failing its workers. He has called Yellow’s plan to convert its regional operations to a “One Yellow” format of multiple regional carriers operating in a long-haul system “despicable.”

O’Brien said that the company’s failure to pay into the states’ funds was due to “gross mismanagement.”

“Following years of worker givebacks, federal loans, and other bailouts, this deadbeat company has only itself to blame for being in this embarrassing position,” O’Brien said.

Yellow sharply disputed that description.

“It is the Teamsters’ leadership who has failed the 22,000 Teamsters employed by Yellow as well as the 8,000 non-union employees who may soon become the Teamsters’ collateral damage,” Yellow responded.

For months, Yellow said Teamsters’ leadership has “steadfastly refused” to negotiate the company’s long-planned and necessary modernization effort that would enable Yellow, a 100-year-old company, to streamline and strengthen its operations to compete against non-union carriers.

跟上时代,客户的需求,你们llow says it must implement its well-publicized business modernization plan known as “One Yellow.” But it says Teamsters’ leadership has rejected all proposed changes of operations and all proposed interim agreements, freezing the company’s business plan for nine months.

This has cost Yellow in excess of $137 million in adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) and has prevented critical refinancing for Yellow. The company is suing the Teamsters for that amount.

Ever since Teamsters’ leadership made its request that Yellow open its contract early, Yellow has tried to meet to negotiate a contract that would provide wage increases for its Teamster employees.

In fact, just last week, Yellow says it made yet another proposal to the Teamsters, offering a “significant wage increase that aligns with its union competitors” such as ABF Freight System.

Commencement of meaningful negotiations with the Teamsters would set the stage for Yellow to reengage in comprehensive refinancing efforts with its lenders while clearing a path to advance One Yellow.

“All stakeholders—lenders, shareholders, employees and customers—need to see progress,” Yellow said.

For nine months, Yellow says it has been “ready, willing, and able” to meet with the Teamsters at any time and at any place to discuss the future of its union and non-union employees and to work through the implementation of One Yellow.

Even today, the company remains ready, willing and able to hold serious negotiations,” Yellow said in a statement.

“We aren’t giving up,” a Yellow spokesperson toldLMrecently. “Our employees, who have an average of 14 years’ tenure, want us to be here. Our customers want us to be here, even with all the noise around the company our shipment counts have held up and that’s crucial for us to work through this period while we get to negotiations.”