Court again rejects ABF suit against Teamsters

ABF Freight System has again seen a $750 million lawsuit against the International Brotherhood of Teamsters and YRC rejected by a federal court.

ABF, the largest subsidiary of Fort Smith-based Arkansas Best Corp., announced Aug. 30 through a filing with the U.S. Securities and Exchange Commission that the United States Court of Appeals for the Eighth Circuit affirmed a lower court ruling to dismiss the case.

Officers with ABF have claimed that YRC, a trucking company, and the Teamsters violated the National Master Freight Agreement when the Teamsters provided YRC wage concessions that other trucking companies under the agreement were not provided. The NMFA, implemented April 1, 2008, was designed to create equal labor costs and other benefit payments among trucking companies with drivers represented by the Teamsters.

The lawsuit, first filed in November 2010, was dismissed a second time by U.S. District Court Judge Susan Webber Wright (Eastern District of Arkansas). ABF officials are deciding whether to take a third shot at the case.

“ABF is disappointed in the court’s ruling and the fact that YRC received three rounds of concessions from the IBT that ABF did not also receive. ABF is assessing the opinion and determining whether to pursue additional options,” noted the ABF response.

Arkansas Best officials have said the Teamster wage concessions gave YRC a competitive advantage, and resulted in higher operating costs for ABF. In the past four years, the company has posted a loss.

For the first six months of 2013, the company posted a loss of $8.517 million, more than the loss of $6.321 million during the same period in 2012. In 2012, the company posted a $7.7 million loss, a wide swing from the $6.159 million gain in 2011. The 2011 income company was a big improvement from the $32.693 million loss during 2010. The 2011 financials marked the end of two consecutive years of income losses.

Company and Teamster officials are close to finalizing a new five-year labor agreement. The existing labor contract technically expired March 31, but has been extended to Sept. 30 to allow for supplemental provisions of the contract to be renegotiated or taken back to certain union offices for another vote. The core of the contract was approved by Teamsters on June 27.

Key terms of the contract include an immediate 7% wage reduction that is recovered by the fifth year of the contract. The company was also able to negotiate for flexibility in work schedules and work across job classifications. Most of the about 7,500 workers covered under the agreement are drivers, but the union membership also includes dockworkers, mechanics and office staff. Arkansas Best employs more than 10,000.