Crisis at YRC having ripple effect on labor

http://www.dcvelocity.com/articles/20100405_crisis_yrc_ripple_effect_labor/

The International Brotherhood of Teamsters (IBT) has seen a lot in its 107 years of existence. But in its near two-year effort to rescue troubled trucker YRC Worldwide Inc., it's a safe bet the venerable union went where it has never gone before.
During 2009, as YRC's financial situation grew more precarious, its 35,000 Teamster employees agreed to two wage reductions and an extraordinary 18-month freeze on YRC's pension contributions.
Throughout the year, the union's leadership actively participated in YRC's financial restructuring, acting in an advisory role that was considered well outside the union's traditional box.
Then, as YRC faced a New Year's Eve deadline to execute a swap of $530 million in debt for 1 billion shares of new equity or else confront bankruptcy and a possible shutdown, Teamster General President James P. Hoffa put very public pressure on several financial institutions, notably the colossus Goldman Sachs & Co., to stop buying arcane derivatives called "credit default swaps" that were essentially bets that YRC would default on its obligations and file for bankruptcy protection.
Hoffa pulled out all the political stops, shrewdly framing the debate as a choice between preserving thousands of middle-class jobs and letting greedy financial firms scavenge for a few extra dollars in profits. Facing a potent backlash from lawmakers and regulators already angered over the industry's role in causing the financial meltdown, the firms caved. Not only did they stop buying the derivatives, but they bought up enough YRC notes to enable the debt-for-equity exchange to succeed.
Click to expand...

Log in or Sign up

Forums

Find Trucking Jobs

Crisis at YRC having ripple effect on labor

skinnytrucker Heavy Load Member

Trucking Jobs in 30 seconds

Wait, employers can't reach you!

Log in or Sign up

Useful Searches

Find Trucking Jobs

Crisis at YRC having ripple effect on labor

skinnytrucker Heavy Load Member

Wait, employers can't reach you!