Larry Stewart is a unionized truck driver — just like his father and grandfather before him. He knew, when he became a truck driver 36 years ago, that it wouldn’t be an easy way to make a living.
“You sacrifice your life,” said Stewart, who lives in Edwardsville, Illinois, some 30 miles outside St. Louis. “The money was good for the family, the kids and the wife, but they didn’t see me a whole lot.”
Union trucking jobs aren’t easy to come by, but Stewart managed to get one when he started at Holland in 1999. Holland was acquired by Yellow in 2005, when Yellow bought Holland’s parent company US Freightways. Stewart’s job began changing shortly after that.
Stewart expected to retire in his late 50s or early 60s and enjoy similar pension benefits to his father and grandfather. That plan would be delayed.
From July 2009 to June 2011, Yellow suspended payments into Teamsters’ pension funds as the trucking fleet careened towards bankruptcy. In 2011, Yellow resumed funding pensions at 25%. That means Stewart and the other approximately 22,000 Teamsters members employed at Yellow must work four years to earn an additional $100 per month when they retire. Until the Great Recession, they had to work just one year to receive that benefit.
If Stewart retired after 33 years at Yellow, as he originally planned, his pension would pay him $3,300 a month. However, under the current structure, he would receive only $1,650 a month.
“They screwed us over for the rest of our life with our pension,” Stewart said.
Yellow acquired Holland in 2005 as part of its acquisition of US Freightways. The cost of this acquisition totaled $1.47 billion. (Photo: Jim Allen/FreightWaves)
Nearly 700 miles east, another Yellow truck driver named Brent Skeens has been worried about his future, too. Yellow had said they had the potential to run out of cash by July. Skeens wasn’t sure where exactly he would work next.
During a recent week of vacation time, he said he spent every day looking at trucking jobs available on Indeed and calling local companies. In Roanoke, Virginia, where he lives, the options were limited — and nonexistent for union gigs.
“I’ve always supported the union, but it seems like the union is turning its back on us right now,” Skeens said.
He had worked for another unionized trucking giant, Consolidated Freightways, until 2002, when it went bankrupt.
“I love working for the union companies,” Skeens said. “But this could be two times in 21 years that my company has gone bankrupt. It kind of kicks you in the teeth.”
Yellow is the third-largest trucking company in the less-than-truckload sector. It’s also a fleet with a lot of issues. Since 2009, Yellow has nearly gone bankrupt five times. The most recent was avoided on July 7, when Yellow and its lenders signed a waiver of covenant with a group of lenders and the U.S. Treasury.
In May, the Teamsters rejected Yellow’s proposals to further modernize its network, which would change key work rules. A Yellow spokesperson told FreightWaves it wants to meet with Teamsters immediately to resolve this issue and potentially increase employee wages. Yellow previously said Teamsters representatives have refused to meet.
A Teamsters spokesperson told FreightWaves that the union intends to adhere to its collective bargaining agreement that expires next spring. In a fact sheet, the union said it is currently engaging in its normal membership survey process and previously told Yellow it could begin conversations in August.
FreightWaves spoke with 17 current Yellow employees — one mechanic and 16 truck drivers, who work over-the-road or locally — to learn more about the rank and file’s reaction toward this brawl. Five drivers were connected to FreightWaves through Yellow’s spokesperson, who remained on the phone with each interview.
Here’s what we learned …
‘Enough is enough’: Teamsters rank and file split on how union should approach Yellow
Eight of the 17 interviewed by FreightWaves disagreed with O’Brien’s choice to not negotiate with the Teamsters on the change of operations. The other nine said they supported O’Brien’s approach.
“I am going to speak the truth — I love it,” said Louie, a Yellow truck driver based in California who asked to not have his last name printed so he could speak more freely. “Enough is enough. We’ve been giving up so many things from 2008 to now and we don’t see the company moving forward. We don’t see them in a better position than they were back in 2008.”
Yellow acquired Roadway for $966 million in 2003. (Photo: Jim Allen/FreightWaves)
Yellow’s network is currently a mishmash of several trucking fleets it acquired in the early 2000s. Those networks were never fully integrated.
A 2019 labor contract enabled Yellow to consolidate those networks in an initiative called One Yellow. Yellow integrated networks in the western U.S. last year. In its next phase of integration, Yellow wants to convert nearly 1,000 truck drivers into a new job called “utility driver”; this may reduce their pay and would substantially change their job duties.
The Teamsters union is blocking further consolidation. Yellow claimed that the union’s refusal to continue negotiations on One Yellow changes put the company’s financial future in jeopardy. O’Brien said a Yellow shutdown was “out of our control” and refused to budge on the operational changes.
The Teamsters said in a June 27 press release that the union has “diligently adhered to the terms” of its current collective bargaining agreement. A union spokesperson said the change of operations that Yellow is requesting would violate that agreement.
“The company is misleading our members and the public,” the spokesperson said. “We have a contract with Yellow that expires March 31, 2024, and Teamsters are living up to it. Yellow’s management knows they’ve failed this company and their workforce because they can no longer live up to the terms they once agreed to. Yellow has proven time and again it cannot manage itself.”
Yellow filed a $137 million lawsuit against the Teamsters on June 27 for blocking the company’s change of operations.
In the suit, Yellow claimed it would run out of cash by mid-July if the Teamsters did not approve these plans.
On July 7, an imminent bankruptcy was averted when Yellow and its lenders signed a short-term agreement around certain requirements on its debt. The agreement will last one quarter for the Treasury, which holds a 30% stake in Yellow following a controversial $700 million loan in 2020, and two quarters for the lender group.
Starting in March, Teamsters has declined to negotiate further with Yellow concerning the proposed change of operations. All five Yellow truck drivers who were connected to FreightWaves via the company’s spokesperson said they wanted the Teamsters to sit down with Yellow and hash out these proposed changes.
“A lot of us out here do not like the animosity that’s going on between the union and the company,” said a truck driver based in the Midwest, who was connected to FreightWaves through Yellow’s spokesperson and asked to not have his name printed to avoid retribution from the union. “It’s not 30,000 jobs — it’s 30,000 families who are in need of things to go forward.”
Two additional Yellow truck drivers agreed. Dan Ferenczi, who is based in South Bend, Indiana, said there’s been poor communication from both Yellow and Teamsters. He would rather the two sides communicate to keep the company afloat.
“I’m not going to bad mouth someone who put my kids through school,” said Ferenczi, who has worked at Yellow for three decades. “I just want them to get to the table and communicate a bit. But nobody’s really come out and communicated really well.”
Most employees were concerned that Yellow could go bankrupt. Three expressed that they had given up on Yellow and did not care if the company shut down. Brian Atchley, a Yellow mechanic in St. Louis, is one of them.
“We’re beyond the point that we care,” he said. “On one hand, it’s a decent job with a steady income, but on the other hand, how much do you let them get away with this?”
Twelve said they wanted their jobs to be saved. A Yellow truck driver in Wisconsin said he wanted to see union jobs be available for the next generation. He asked for his name to not be printed to avoid retaliation from Yellow.
“I would like this to be here for the next group of people,” said the Wisconsin driver. “I’ve always had a good home. I’ve always made a good life. I just want to maintain it for the next corps of people.”
Still, the Wisconsinite, who has been a truck driver for 40 years, said he’s been disheartened by Yellow’s comparatively low pay, reduced pension benefits, and a one-week reduction of vacation time that applied to long-time employees from 2010 to 2019.
“That’s why our union is standing up and saying not anymore,” the driver said. “As Sean O’Brien stated, the concession stand is closed. We’ve done our part to try to keep the company going and moving forward.”
A Yellow spokesperson said the Teamsters “halted our business plan, causing uncertainty and concern among everyone at Yellow. We need to meet with IBT to resolve this immediately so we can implement One Yellow and get back to focusing our full attention on our customers.”
A June 12 fact sheet from Teamsters said Yellow is misleading employees with false information. The union said it would traditionally begin negotiations on a new contract at the end of the year and must gather membership feedback before bargaining.
“We do not intend to bargain without membership input,” the Teamsters fact sheet read. “The Teamsters explained to Yellow that negotiations are a two-way street, and that Yellow would have to provide immediate significant economic increases for the members if it wanted to reopen the contract early.”
‘We have a lot of people who can’t retire now’: Yellow truck drivers frustrated with pay and pension
All but four Yellow employees expressed the need for increased wages and pension contributions. The four who did not were connected to FreightWaves by Yellow’s spokesperson.
“We want the same thing our employees want, and this is exactly why we have been attempting to negotiate with the IBT to discuss wage increases and changes to our existing contract,” a Yellow spokesperson said in a statement concerning the demand for increased compensation. “We have to meet in order to resolve this immediately.”
Teamsters countered in a June 12 fact sheet that the company’s proposed changes could result in unionized Yellow employees again making concessions for the company. “Yellow wants to establish a one-way street that allows it to get everything it wants up front and early,” the fact sheet read. “The company wants our members to wait to see what happens down the road, even if it means workers are once again left holding the bag.”
During the Great Recession, the Teamsters granted Yellow a 15% wage cut and agreed to forgo pension contributions. Those wage concessions were extended in the 2014 contract as a way to keep Yellow in business.
Teamsters-represented employees at Yellow won an 18% wage increase in their 2019 contract, which is the current agreement.
Yellow reached a July 7 agreement with a group of its lenders to waive certain covenants around its debt obligations. (Photo: Jim Allen/FreightWaves)
Thirteen employees told FreightWaves they would like the upcoming agreement to address pension funding specifically.
“We have a lot of people who can’t retire now,” said Pete Boese, a South Bend-based truck driver at Yellow. “The pension is a pretty big deal.”
Glenn Lowe, a Tampa, Florida-based truck driver, is one of those Yellow drivers whose retirement plans were shafted. When Lowe joined Roadway in 1997, he recalled that retirees from his terminal said they would earn a pension of $3,500 to $4,000 a month. (Yellow acquired Roadway in 2005.)
After 30 years of working, when Lowe planned to retire, he should be eligible for around $3,000 per month. Instead, his pension will more likely be around $1,500 per month, in part because he was laid off from 2008 to 2012 due to economic conditions.
Knoxville, Tennessee-based driver David Crisp and Ferenczi of South Bend estimated separately that their monthly pension payouts would be at least $1,000 higher if Yellow had fully funded pensions since 2010.
A Yellow spokesperson said its retirement benefits are greater than those offered by nonunion LTL trucking firms. The representative added that Yellow is “prepared to negotiate changes to retirement benefits.”
The Wisconsin-based Yellow truck driver and Rick Cole, a St. Louis-based driver, said their terminals struggle to recruit new talent because the pay and benefits compare poorly to unionized and nonunion carriers. The Teamsters union claims Yellow has at least a $5-per-hour cost advantage over ABF Freight, another union LTL fleet.
A Yellow spokesperson countered in a statement: “Engaging in negotiations that lead to a stronger compensation package will better enable us to recruit and retain talent.” The Teamsters said in the fact sheet it intends to honor the current contract and begin negotiations later this year.
Yellow employees interviewed by FreightWaves noted that the company’s insurance policy was unusually good — and kept several of them at the company. “We do have the best insurance in the industry,” said Skeens, the Roanoke-based truck driver.
Some Yellow drivers said their trucking fleet was better before the Yellow takeover
Six Yellow employees said their previous employers moved freight more efficiently before Yellow began to integrate with them. Three — two who had worked at Roadway and one who had worked at Reddaway — said they noticed no major changes. One, who previously worked at Reddaway, said she noticed issues at first but they went away.
These changes, in some cases, have resulted in a long-term reduction of freight at individual terminals, six employees said. A Yellow spokesperson declined to confirm these claims “based on the information provided.”
The claims may be limited to certain regions. Yellow saw an uptick in revenue from 2012 to 2022 of about 8.1%. On the other hand, other LTL players saw a much larger increase in revenue over that same period. Old Dominion Freight Line’s revenue increased by nearly 200%, SAIA’s by 154.8% and unionized ABF’s by 131.5%.
A Yellow spokesperson said modernizing the fleet through the One Yellow business plan would enable the company to be faster, more consistent and easier to work with. In some areas, customers may be serviced by terminals that are next to each other but with separate workforces. Teamsters said these changes in operations would “would violate nearly every contract supplement nationwide” by changing the job duties for nearly 1,000 drivers.
A Yellow truck driver based at the South Bend Holland terminal, who asked to not have his name printed, said inbound freight was typically around $800 to $900 bills a day in the early 2020s. But shortly after the terminal’s switch to Yellow in March 2022, freight volumes were cut by roughly half. Two other South Bend Holland truck drivers also said their terminal’s volumes sharply declined following the switch to Yellow.
Prior to becoming part of Yellow, the anonymous South Bend truck driver said Holland offered 9 a.m. guaranteed deliveries, which is no longer the case. He said he believes that is one reason why they’ve lost customers.
Four employees based in different states who began their careers at Holland said their previous computer system allowed customers to track trailers. The current one from Yellow does not.
The company also moves freight in a way that is different from how the regional companies operated. Six employees based in cities across the country said that the way that Yellow runs freight has resulted in delays and frustrated customers.
The Yellow truck driver based in Wisconsin said Holland, where he originally worked, had a “kick and pick” freight system where a linehaul driver would pick up freight and drop it off along their route. Yellow’s network is much larger than Holland’s, which the driver said resulted in some inefficiencies.
“Today, things go to a velocity center or a break bulk center,” the driver said. “Things get docked and moved on from there, instead of us kicking and picking along the way.” Freight could go 100 miles in the wrong direction, then back to where it would have gone.
A Yellow truck driver based in Tacoma, Washington, said that following Reddaway’s integration with Yellow, it’s become more common for freight to be incorrectly shipped to Alaska, then return to the Lower 48, then back to Alaska. Some freight has been shipped by rail by accident. This has resulted in a loss of customers in her terminal, she said.
A Yellow truck driver based in the Mountain West, who was connected to FreightWaves through a Yellow spokesperson, said there was initially a backlog when Yellow and Reddaway merged, but it has since cleared up. She said Yellow was behind around 15 trailers per day when the merger happened.
A Yellow spokesperson said One Yellow is key to modernizing operations and improving customer experience, though merging may at first be challenging.
“Merging operations in any business is complex work and requires significant planning and execution,” the spokesperson said. “Change can be hard at first, and it is not uncommon to see initial challenges as employees adapt to a new way of doing things. However, all companies must evolve to meet increasing customer demands in order to keep up with the competition.”
Yellow’s revenue grew by 8.1% from 2012 to 2022. However, some of its competitors’ revenues more than doubled during that period. (Photo: Jim Allen/FreightWaves)
Several truck drivers said the changes in Yellow’s brand, including recently renaming the regional LTL carriers it acquired in the early 2000s, have also confused customers and led to freight volume decline.
A Yellow spokesperson countered in a statement: “This is exactly why we need one company operating as One Yellow, not four separate regional outdated companies. Yellow will become more efficient and recognizable by name under One Yellow. Our modernized network will enhance the customer experience, which will lead to growth in freight volumes for many years to come. No other LTL carrier has four different brands and neither will we once One Yellow is implemented.”
Managers fleeing some Yellow terminals
Following the integration of Yellow and these regional trucking companies, five employees nationwide said their terminals lost employees and managers.
Annual filings reflect anecdotal reports of fewer employees. Yellow shed some 6.3% of its head count from 2012 to 2022.
Other LTL players have not seen the same reduction in staff. ODFL increased head count by 80.3% over that same period, while SAIA (44.7%) and unionized ABF (42.7%) also saw an increase.
The Yellow representative said One Yellow will allow the 99-year-old company to better compete “in a dynamic, fast-paced marketplace.”
“We are in the final stages of the transformation, and we need the IBT to come to the table to make it a reality for our employees, shareholders and customers,” the representative said.
Teamsters said in the fact sheet that it will not grant the concessions Yellow is currently seeking.
“Yellow has shown that it doesn’t deserve and cannot be expected to continue under its current structure,” the fact sheet said. “The Teamsters cannot and will not keep bailing out this company with concessions. We are not interested in helping its corporate executives save face. It is not left to the Teamsters to save this company. Our members have given enough.”
Louie, the California truck driver, said that from 2008 to today, his terminal (previously Roadway) has seen eight terminal managers. It was the same person from 1999 to 2008.
An Oregon-based truck driver connected to FreightWaves through Yellow PR said around 60 drivers worked at his terminal as of 2019. Now, it’s around 30.
Lowe, the truck driver based in Tampa, said his terminal has had four managers since 2016.
A Yellow representative declined to comment on these claims and noted the average tenure of a union employee at Yellow is 14 years.
Lowe said he’s not a “gung-ho union” guy — but he’s baffled by Yellow already claiming the company is out of cash. That’s making him more amenable to Teamsters blocking Yellow’s attempted change of operations.
“I don’t disagree with the Teamsters at this point,” he said. “There have been so many givebacks by the Teamsters membership that for Yellow to be coming with their hands out again, asking us to bail out the company for the good of keeping the doors open, seems like a lot to ask — especially after having gotten a bailout from the government.”
What do you think about the standoff between Yellow and Teamsters? Comment below or email rpremack@freightwaves.com.
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