YRC Worldwide and the Teamsters union said late Jan. 17 that they have reached a tentative new labor agreement to help the carrier deal with its debt and financial situation.
The company said the plan extends the contract to 2019 as it incorporates “a number of revisions to the company's previous proposal which address concerns raised by the Teamsters leadership and its members.”
The union said the deal was the product of “round-the-clock negotiations” this week that followed the rejection of an earlier proposal.
The Teamsters current contract ends in March 2015.
The new proposal, contained in a memorandum of understanding, “is something our employees can have confidence is the best — and only remaining — path forward," said YRC CEO James Welch.
Approval of the plan rejected by the Teamsters earlier this month was a requirement for YRC to go forward with a $300 million debt-reduction plan.
The Teamsters gave no details of the new tentative agreement, but said it would be presented on Jan. 21 to local leaders, who will decide whether or not to recommend approval.
The less-than-truckload carrier is trying to lower its $1.4 billion debt as some repayments approach. The first $69 million is due next month.
“Once the vote results on this initial company proposal were in and our members’ sentiments were voiced loud and clear, we immediately pushed YRC to re-engage all stakeholders to come up with an alternative solution,” said Teamsters General President Jim Hoffa.
YRC last month said it needs the debt reduction steps to reduce its interest expense and interest rates. During three quarters of 2013, its interest costs were $124 million, far above the $30 million in profit before interest and taxes.
YRC Worldwide ranks No. 5 on the Transport Topics Top 100 list of U.S. and Canadian for-hire carriers.