YRC Seeks New Labor Contract Until 2019
YRC Worldwide Inc. has told the Teamsters union it needs a new contract agreement into 2019 in order to have lenders refinance debt that begins to come due next year.
The company outlined that scenario in a presentation to the union. YRC said a new agreement must have predictable future wage increases and improved operational efficiencies.
The company’s 26,000 Teamsters already are working with a 15% pay cut.
YRC has asked the union to formally begin talks to extend the current agreement that expires in March 2015. The company has $1.4 billion in YRC debt, with repayment obligations that begin in 2014. The company is scheduled to report earnings Nov. 12.
“Our lenders will not refinance our debt unless we have a five-year labor agreement with an improved cost structure and operational performance,” company documents said. “Without a refinancing, we cannot satisfy all of our debt obligations that come due in the 17 months.”
The document was posted on the website of the Teamsters for a Democratic Union.
