200 Birmingham workers laid off in trucking company shutdown

200 Birmingham workers laid off in trucking company shutdown

Two hundred Birmingham workers are left jobless in the wake of trucking company Yellow Corporation’s abrupt shutdown across the United States.

In late July, the 99-year-old Nashville-based company (NASDAQ: YELL) closed its facilities, including the Birmingham site near Tarrant, laying off 30,000 workers across the country. The nearly 100-year-old company blamed the International Brotherhood of Teamsters, a Washington, D.C.-based labor union, for driving it out of business.

A sign at Yellow’s facility on Industrial Parkway was taped to an orange traffic cone: “Dear Valued Customers and Employees: All company operations have ceased as of Sunday July 30, 2023, at 12:00pm EDT. For union employee related concerns please contact your union representative. For customer-related concerns please call: (800) 610-6500.”

About 68 of those Birmingham employees were union members, ABC 33/40 reported. The company also closed facilities in Decatur, Montgomery and Mobile. It’s unclear how many workers were laid off there.

“All workers and employers should take note of our experience with the International Brotherhood of Teamsters (”IBT”) and worry,” Darren Hawkins, Yellow’s chief executive, said in a statement Sunday. “We faced nine months of union intransigence, bullying and deliberately destructive tactics. A company has the right to manage its own operations, but as we have experienced, IBT leadership was able to halt our business plan, literally driving our company out of business, despite every effort to work with them.”

Yellow blamed Teamsters for its failed negotiations over its contract as well as a business plan called “One Yellow,” which the company said it needed to make itself more competitive and strengthen jobs and customer service. The company said that it’s counted more than $137 million in losses because it couldn’t implement the business plan, and in late June sued Teamsters in the U.S. District Court for the District of Kansas, alleging breach of contract and loss of enterprise value.

After Yellow’s companies opted to suspend health care benefits and pension accruals for workers, Teamsters threatened to strike. A few days later, the company extended health care benefits. About a week later, Yellow informed Teamsters of its closure. About 22,000 of the company’s employees were Teamsters members.

“Yellow benefitted from historically low labor costs compared to other freight leaders, yet they still managed to drive the company into the ground,” said Teamsters General Secretary-Treasurer Fred Zuckerman in a statement on Sunday. “Workers do not own that death. Yellow management must.”

In the early 2000s, Yellow made a few big acquisitions, which preceded several other close calls with bankruptcy in the years that followed. Now, the company reports more debt than assets.

Yellow didn’t report the layoffs in Birmingham to the Alabama Department of Commerce until two days after it shut down, and no notices for its facilities in Decatur, Montgomery and Mobile appear publicly, per the state’s list of WARN notices. Plant facilities and other major employers are legally required to file a WARN notice — a notification of plans to close a facility or otherwise cut a lot of jobs — at least 60 days before laying off workers. Though, there are some exceptions in the case of union-related shutdowns.

The company has partnered with the American Trucking Associations to create a searchable job database for roles including freight and operations professionals, logisticians and mechanics, specifically for Yellow employees who were laid off.

Spokespeople for Yellow, Teamsters and the Alabama Department of Commerce did not respond to requests for comment from AL.com in time for publication.

On Sunday, Yellow Corp. filed a Chapter 11 voluntary petition for bankruptcy in federal court in Delaware. The company reported nearly $2.2 billion in assets and nearly $2.6 billion in liabilities, or debt.

Yellow is a less than truckload freight shipper, which involves transporting products with smaller freight loads. Its brands, including YRC Freight, New Penn, Reddaway and Holland, provided regional, national and international shipping services to the company’s customers.

The company was struck by millions of losses in the decade prior to the Covid pandemic, a time marked by increased customer demand and strains to the supply chain network. During that time, Teamsters agreed to pay cuts and gave up pension securities over the years on behalf of its Yellow employee members to help buoy the company, the union representative said.

In 2020, the federal government loaned Yellow Corp. $700 million in 2020 through the CARES Act, in exchange for a 30% stock ownership, which the U.S. Department of the Treasury still holds. Yellow has said that it plans to pay back the loan.