newsworthy
Judge dismisses ABF suit
against YRC, Teamsters
A FEDERAL DISTRICT COURT JUDGE IN ARKANSAS HAS THROWN
out a lawsuit filed by less-than-truckload carrier ABF Freight System
Inc. alleging the Teamsters Union and rival YRC Worldwide Inc. violated provisions of the National Master Freight Agreement (NMFA), the
collective bargaining compact that governs most of the nation’s unionized trucking companies.
The ruling by Judge Susan Webber Wright deals a potentially crippling
blow to ABF’s efforts to seek legal redress and $750 million in damages
based on allegations that three rounds of wage and benefit concessions
the Teamsters have granted to YRC over the past two years violate the
five-year agreement’s basic premise that it should apply equally to all the
companies that signed it.
Judge Wright ruled that ABF did not have standing to sue YRC and the
union. The Teamsters said the ruling validates their claim that ABF had
already taken itself out of the NMFA and had no right to bring the suit
in the first place. The current agreement was ratified in 2008.
Teamster General Counsel Brad
Raymond said the ruling “should
send a strong message to ABF that
its attempts to interfere with the
contractual agreement between
[YRC] and its Teamsters-repre-
sented employees must end.”
ABF spokesman Russ Aikman
said the company is “disappointed”
Last April, ABF and the Teamster leadership reached an agreement for
wage and benefit reductions similar to what the union granted to YRC.
However, ABF’s rank-and-file employees rejected the proposal, leaving
ABF at what it contends is a significant cost disadvantage to YRC.
In its suit, ABF said it had held discussions in 2007 with the Teamsters
about negotiating a contract separately from the NMFA. However, the
company was pressured by the union to remain in the agreement, with
the understanding that the 2008 NMFA was to be a “national standards
agreement” for all the companies that signed it.
Thomas R. Wadewitz, transport analyst for JPMorgan Chase, said the
ruling clouds ABF’s path toward changing its unionized cost structure.
“While [ABF] could try to return to the negotiating table with
Teamsters leadership, we suspect that the Teamster leadership would be
reluctant to quickly pursue discussions” in the wake of the lawsuit,
Wadewitz said. ;
TNT formally
announces plans to sell
express unit
Dutch transport giant TNT has officially separated its mail and express businesses as of the first of the year.
In an announcement made at its
annual analysts meeting in December,
TNT confirmed plans first disclosed in
August to cease express operations and
focus exclusively on its mail business.
However, it will retain, at least temporarily, a 29.9-percent financial stake
in the express operations. The value of
that stake will be returned to shareholders as soon as possible, TNT said.
Separately, Peter Bakker, TNT’s CEO
for the past 10 years, announced that
he will resign after the separation of
the two companies is completed. In a
statement, Bakker said the transaction
“provides shareholders the opportuni-
ty to invest in two sector leaders.”
The announcement effectively puts
one of the big four global express
leaders in play, and could trigger a
bidding war among the three largest
express companies—FedEx Corp., UPS
Inc., and DHL Express—for TNT’s intra-
European and intercontinental assets.
TNT’s express business is focused on
intra-European and international
operations linked to Europe; it has
almost no presence in the U.S. market,
although it operates a trans-Atlantic
air-ground network with U.S. trucker
Con-way Inc.
Of the four main express companies, FedEx is considered to have the
weakest competitive position in
Europe. Acquiring TNT could be a
boon to FedEx’s operations on the
Continent. For arch-rival UPS, which
has a larger presence in Europe than
FedEx, an acquisition of TNT would
significantly strengthen its competitive position against DHL, considered
the market leader in Europe. ;
