WASHINGTON — The International Brotherhood of Teamsters has scheduled a Thursday conference call for its Arkansas Best Freight members to discuss possible modifications to the National Master Freight Agreement, the contract under which union workers are employed at the less-than-truckload carrier.
A March 12 Teamsters Freight Division update, posted Monday on the union Web site, outlines the severe impact the economic downturn has had on ABF, “one of the best and most efficient motor carriers in the industry.”
The bulletin credits the company for having the cash reserves to see it through this far, but “ABF’s situation has changed.” The union cites falling revenues and a record operating loss for 2009, along with diminishing cash reserves, credit draws and a sagging stock price.
“Based on our current understanding of the industry, the company’s financial position, and from concerns raised by many of you, we now believe it is in our best long-term interest to fully engage ABF through formal discussions to determine if and what type of contractual relief may be necessary,” the notice reads.
Local leaders discussed the matter in a call March 15, and an ABF membership call-in meeting is set for 8:30 p.m. EDT Thursday.
“If discussions proceed, we will apply similar standards of equality of sacrifice, access to information, ‘snap back’ provisions, and other corporate and financial protections negotiated under the relief memorandums with YRCW,” says the update, referring to the union concessions made last year to stabilize teetering LTL giant YRC Worldwide.
Industry analysts suggested at the time that ABF would likely be forced to seek similar terms for competitive reasons.
A Wolfe Trahan investor note on Wednesday suggests a wage concession “likely in the 5 percent to 15 percent range and potential pension relief in exchange for equity.” The firm reiterated its “Outperform,” or positive, rating on Arkansas Best stock, noting “strong potential upside operating leverage” with regard to coming improvements in demand and pricing, as well as the labor concessions.
ABF “is pleased that the IBT recognizes the need for potential discussions,” said ABF Freight System Inc. spokesman Danny Loe in an e-mail Wednesday.
Kevin Jones of The Trucker staff can be reached for comment at email@example.com.
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