Teamsters union members at YRC Worldwide Inc. will vote Jan. 25 and 26 on a revised contract extension proposal, which is on a fast track as the first $69 million of debt repayment looms in about three weeks.
Union local leaders endorsed the new extension late on Jan. 21, clearing the way for a vote at local union halls. Rank and file Teamsters will be voting as the first $69 million of YRC debt comes due in mid-February.
Another $327 million of debt is due this year, and YRC has been seeking union approval of the contract extension into 2019 in order to win lender approval for refinancing of the carrier’s obligation.
On Jan. 9, the union said an initial proposal was rejected.
“Our members made their voices heard about the company’s initial proposal, and we went back to the company and negotiated significant improvements,” said Tyson Johnson, director of the union’s freight division.
The new tentative agreement posted on the union website contains multiple changes, including 40-cent-per-hour wage increases for three years starting in 2016. The raises are extended to dock, clerical and maintenance workers who previously weren’t included. There also is a $750 lump sum payment.
An earlier proposal to reduce vacation time was withdrawn. The top wage for clerical, dock and maintenance workers hired after the contract extension takes effect also is being raised.
YRC has cited rising interest costs a key reason for the recent slowdown in its financial recovery. The carrier recorded seven quarters of year-over-year operating performance improvements until it was tripped up in the third quarter by inflated operating costs. Much of those costs were tied to extra expense as the result of an operational change at YRC Freight.
YRC Worldwide is ranked No. 5 on the Transport Topics Top 100 listing of U.S. and Canadian for-hire carriers.