YRC Worldwide said today it is “in discussions” with Teamsters union leaders on the company’s future and will revise its proposed contract, following the decisive defeat of its original proposal last week.
The company is racing to prepare a revised proposal that its Teamsters employees could accept before the first of several debt payment deadlines arrives in February.
“It is clear the Teamsters understand the urgency of the current situation,” YRC Worldwide CEO James Welch said in a statement. YRC’s lenders made extended concessions a prerequisite to refinancing $1.36 billion in debt.
Earlier this month, the company and its lenders reached a $1.15 billion refinancing agreement, dependent on extended labor concessions. In December, the company announced a $300 million debt-for-equity swap that also depends on Teamsters’ concessions.
“Although the company must achieve operational costs savings in the agreement, we also understand that simply re-voting the same proposal is not an option,” Welch said.
Teamsters Freight Division leader and negotiating committee co-chair Tyson Johnson told local union leaders in a Jan. 14 memo there were no plans for a re-vote.
The original proposal would have extended a 15 percent wage cut and reduction in pension contributions from 2015 through 2019 and given the company more authority to subcontract some work.
YRC Teamsters rejected the proposal 61 percent to 39 percent. Approximately 19,000 of YRC’s 26,000 Teamsters participated in the ratification vote.
“Over the past few days, many employees have reached out to me expressing concern about the future of the company and about how they could protect their jobs,” Welch said.