Arkansas Best Corp., the Fort Smith-based parent company of ABF Freight System Inc., and the International Brotherhood of Teamsters have extended their current labor contract through June 30 while employees vote on a new five-year agreement.
According to documents filed May 29 with the U.S. Securities & Exchange Commission, ballots for the new labor contract will be mailed June 3 to the 7,500 employees represented by the Teamsters.
The votes are expected to be counted “on or around” June 27, the SEC documents state.
During the ratification process, “it is business as usual at ABF,” the company said in the documents.
“We believe that the contract proposal that will soon be voted on by our employees represents the best opportunity to return the company to profitability, while preserving some of the best jobs in the industry. The agreement maintains all health, welfare and pension benefits, and provides for wages that will be higher at the end of the agreement than current rates,” Arkansas Best said in the filing.
The union negotiating committee has unanimously endorsed the tentative agreement that members will vote on. Union leaders said in a news release May 20 that while the proposed contract calls for a 7 percent wage cut initially, that reduction “will be entirely recouped by the fifth year of the contract.”
“Nobody ever wants to see a pay cut,” Gordon Sweeton, co-chairman of the Teamsters’ National ABF Negotiating Committee, said in the release. “But in light of the company’s struggles and our desire to see the company survive, something needed to be done. It is in our best interest, as well as ABF’s, that this company be given a chance to climb out of this deep recession so that our members’ futures are protected.”
Contract negotiations between the trucking company and the Teamsters began Dec. 18.
While reporting Arkansas Best’s first-quarter revenue in April, president and CEO Judy McReynolds said high labor costs offset growth in revenue and tonnage. ABF accounts for more than 90 percent of Arkansas Best’s revenue.
The company posted a net loss of $13.4 million, or 52 cents per share, for the quarter that ended March 31, an improvement over a net loss of $18.16 million, or 71 cents per share, in the same period a year earlier.