The International Brotherhood of Teamsters announced a tentative $7 million settlement with USF Corp. over the company’s closure of USF Red Star in May 2004. The pact will result in payments to almost 1,600 union members who lost their jobs when USF Corp. abruptly shut down its Red Star unit due to a labor dispute.
Following closure of USF Red Star, the Teamsters sued USF Corp., USF Red Star and USF Holland in a Philadelphia federal court. The union argued that the shutdown had violated the federal mandate to give 60 days’ notice and that USF illegally evaded Red Star’s obligation to bargain over the decision to close and instead replaced USF Red Star with USF Holland.
Under the proposed settlement, Teamster-represented workers at Red Star terminals with 50 or more employees will receive a pro rata share of $6.6 million based on their W-2 earnings for 2003, or a minimum of $3,200 each. Unionized workers at Red Star terminals with fewer than 50 employees will receive about $1,000 each for the breach of contract claims.
The settlement and attorneys fees still must be approved by the court. Yellow Roadway Corp. currently owns the remaining USF operating companies — USF Holland, USF Reddaway, USF Bestway and USF Glen Moore.
