YRC, Teamsters continue talks as debt deadline nears
YRC Worldwide and the International Brotherhood of Teamsters are continuing discussions regarding the company’s future after the union employees last week rejected a contract proposal that would have allowed the company, it said, to pay off about $300 million in debt.
The IBT on Thursday stated that it will not vote again on the proposal.
“We have told the company that we are willing to consider a modified proposal that would protect our members and enhance the company’s financial position, but that it must contain meaningful improvements over the last proposal,” said the IBT, according to an update posted to its website Thursday.
The rejection is the latest roadblock in the effort to reach an agreement and comes just before the company’s February debt deadline, when it must pay off $69.4 million in loans. Around $1 billion in debt will come due in the next two years.
As reported previously by American Shipper, the rejected Jan. 9 proposal included no wage cuts, but also called for a delay in wage increases until 2015. The contract would have also increased the overtime pay threshold from eight hours to 40 hours; a rule change that would no longer pay a full week of benefits for a partial work week; and a change in outsourcing rules that would allow for non-union maintenance and road work.
YMC on Thursday stated that it is planning to revise its proposal in order to refinance the company and protect its 32,000 employees.
“It is clear the Teamsters understand the urgency of the current situation,” said YRC Worldwide Chief Executive Officer James Welch in a statement. “Although the company must achieve operational costs savings in the agreement, we also understand that simply re-visiting the same proposal is not an option.”
In December, American Shipper reported on the company’s struggle to get the union to extend its contract for another five years. An agreement that would let the YRC reduce its debt by about $300 million is dependent upon the approval of a new contract.
YRC stock closed Thursday up 20 percent at $15.47 per share.
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