A federal judge dismissed a lawsuit that challenged three rounds of labor concessions at YRC Worldwide by claiming the Teamsters union violated a national contract by offering wage concessions to YRC and not ABF Freight System.
The ruling, which ABF said it may appeal, could impact the less-than-truckload carrier’s negotiations with the Teamsters for a new labor contract next year and boost struggling YRC Worldwide, which still is trying to stem recurrent losses.
U.S. District Court Judge Susan Webber Wright threw out the ABF lawsuit, which sought $750 million in damages, for the second time Aug. 1, ruling that ABF had not exhausted its chances for redress under the National Motor Freight Agreement.
The decision (available through an ABF Web site), along with defendants YRC Worldwide and the Teamsters, accepts that ABF is party to the same 2008 NMFA contract as YRC and its subsidiaries. But the ruling hinges on the terms of that contract’s dispute arbitration process.
ABF’s complaint against YRC Worldwide and the Teamsters should be handled first by the NMFA’s National Grievance Committee, which would include representatives of both the union and employers YRC and ABF, Webber ruled in her decision.
“The court finds that ABF has failed to state facts which would allow the court to appoint an alternative tribunal to hear its grievance,” Webber said in her decision.
ABF argued that the NMFA rules would disqualify both of its opponents from sitting on the grievance panel, as they are directly involved in the carrier’s complaint. The Fort Smith, Ark.-based carrier said it would consider an appeal of the decision.
In her decision, Webber said the NGC could agree on changes to its procedures by majority vote, and that that permitting the employer-union grievance panel to handle the problem internally “effectuates national labor policy.”
The fact that all parties now agree ABF is covered by the same NMFA as YRC Worldwide was a symbolic victory, at least, for ABF, which has argued all along that the interim agreement it signed in 2008 made it a party to the national contract.
The lawsuit, originally filed in November 2010, was first dismissed the U.S. District Court for the Western District of Arkansas that December, when the court decided ABF had not proved it was covered by a common contract with YRC Worldwide.
The U.S. Court of Appeals for the Eighth District overturned that ruling in July 2011, and sent the case back to the district court. “ABF clearly has constitutional standing,” to bring its case against the Teamsters, the appellate court panel said.
ABF argued three rounds of wage and benefit concessions negotiated by YRC Worldwide and the Teamsters were illegal under the NMFA, which ABF claims does not allow individual companies to negotiate separate concession packages.
Despite that argument, ABF sought its own package of concessions from the union in 2010 but was rebuffed by its own employees when ABF Teamsters rejected a 15 percent wage cut and gain-sharing plan in a 56-to-44-percent vote that May.
The company tried to negotiate a separate contract in 2008, after industry consolidation left YRC and ABF as the two major surviving NMFA employers, but eventually signed a contract that mirrored the terms of YRC’s Teamster pact.
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