Arkansas Best Corp. announced late Monday, May 24, that its ABF Freight System subsidiary did not obtain the necessary votes from its 7,000 International Brotherhood of Teamsters employees to implement modifications to IBT’s current National Master Freight Agreement labor contract with ABF. The proposed modifications included a 15 percent reduction in all wages paid under the NMFA and an “Earnings Plus Plan” for all employees that would have paid quarterly payments when ABF’s operating ratio reached certain profitable levels and equal reduction of nonunion compensation.
“The current economic decline has been unprecedented in its depth and duration,” says Judy McReynolds, president and chief executive officer of Arkansas Best, based in Fort Smith, Ark. “Our company, including our nonunion employees, has made significant financial sacrifices during this period. It is unfortunate that our union employees have chosen not to participate in better aligning ABF’s cost structure with those of its LTL competitors. Going forward, we will evaluate our various options in dealing with our cost structure and the other issues we face during this challenging freight environment.”
Mail ballots were sent out April 30 and counted Monday, May 24, with the process being overseen by an independent election officer. With a final count of 3764-2936, the workers voted no on the plan, with about 80 percent of the members affected participating in the vote. The plan had called for a reduction in gross wages and mileage rates of 15 percent effective next pay period and running through March 31, 2013. Negotiated wage increases (less 15 percent) and cost of living adjustments, if any, would have remained in effect for the life the plan.
“We took a proactive approach to help ABF get through the worst economic recession since the Great Depression, but our members have rejected the plan,” says Tyson Johnson, director of the Teamsters National Freight Division. “The union will regroup to determine if there are other means to protect jobs and benefits. Our first priority continues to be the members’ best interests.”
