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Court overturns denial of ABF’s challenge to YRC-Teamsters concessions

A federal appeals court on Wednesday, July 6, overturned a lower court’s ruling that ABF Freight System Inc. did not have standing to challenge a series of wage and benefit concessions reached between three YRC Worldwide Inc. entities and the International Brotherhood of Teamsters. The U.S. Court of Appeals for the Eighth Circuit in St. Louis ruled that the case be returned to the U.S. District Court for the Western District of Arkansas for further proceedings.

ABF was appealing U.S. District Court Judge Susan Webber Wright’s decision handed down Dec. 17, 2010, to dismiss its legal challenge of concessions negotiated between the YRC Worldwide entities and the Teamsters. ABF had argued that the concession agreements violate the National Master Freight Agreement.

The Fort Smith, Ark.-based company sent its case to the federal appeals court on Jan. 18. “ABF is very pleased with this decision and looks forward to further proceedings on its lawsuit seeking to level the playing field for all parties of the National Master Freight Agreement,” the company says.

YRC Inc., New Penn Motor Express Inc. and USF Holland Inc. on Nov. 16, 2010, had asked the lower court to dismiss ABF’s complaint because ABF was not a party to the NMFA and had no standing to challenge its amendments.

ABF argued that the Teamsters violated the NMFA in 2009 and 2010 by entering into concessionary side agreements with the YRC Worldwide companies to the exclusion of ABF and other companies signatory to the NMFA; these agreements led to ongoing significant wage and benefit reductions and other economic concessions that were applied only to the YRC Worldwide companies.

ABF, with more than 8,000 union employees, argued the third and latest amendment to the NMFA – negotiated between the YRC Worldwide entities and the Teamsters in late September and ratified by union members Oct. 30 as part of a restructuring plan aimed at saving both YRC Worldwide and more than 25,000 union jobs – would provide further wage, benefit and work rule changes that would generate an average of $350 million in annual savings through the end of the extended agreement.

ABF also sought financial damages in an amount estimated to be about $750 million by the time the NMFA is set to expire on March 31, 2013. “ABF will continue to seek that relief on remand,” the company says.

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