Teamster members at New Penn overwhelmingly have approved a job security plan that provides economic relief to its parent company, YRC Worldwide Inc., the union announced Wednesday, Sept. 9. In the revote, New Penn members – as well as members covered by all mechanics and office agreements – approved the plan 912-334. In the first vote, New Penn members rejected the plan, while a majority of other YRCW employees ratified the plan.
About 1,500 New Penn workers were eligible to vote. “The New Penn local union leaders did a great job explaining the negative consequences if this revote was not successful,” says Tyson Johnson, director of the Teamsters National Freight Division. “The New Penn members realized that hundreds of jobs were at stake in this vote.”
The union says the job security plan provides YRCW with more than $1.2 billion of cost savings over the remaining 43-month term of the agreement and greatly enhances YRCW’s financial position. According to the Teamsters, the wage reduction and pension terminations are effective immediately, but they will not remain in effect unless YRCW and its bank group amend their loan agreements in order to provide the company with sufficient liquidity and flexibility to complete its restructuring and take advantage of the upturn in freight demand anticipated in 2010; also, affiliated Teamster Pension Funds must approve the “deferral/termination” arrangement.
The union says the plan calls for a reduction in gross wages of 15 percent from the full National Master Freight Agreement rates; this includes the 10 percent wage reduction previously ratified by the membership in January. Additionally, the plan will allow the company to terminate pension fund contributions effective from July 1 through Dec. 31, 2010, but employees will not lose accrued benefits or credits previously earned during this period.
“As employee owners and stakeholders, our union work force has made difficult decisions and demonstrated their commitment to achieving long-term success for YRC Worldwide,” says Mike Smid, president of YRC Inc. and chief operations officer of YRC Worldwide, based in Overland Park, Kan. “Revisions to the contract enable the company to strengthen its financial position.”