Teamsters Want House Language on Private Equity To Prevail in Conference
WASHINGTON, June 15 /PRNewswire-USNewswire/ -- Teamsters General President Jim Hoffa today said the union supports the House approach to regulating private investment funds.
House and Senate conferees are meeting today to work out differences between the two chambers' versions of the financial reform bill.
Unlike the Senate bill, the House version does not exempt private equity. It also allows the Securities and Exchange Commission to require private-equity and hedge fund advisers to disclose important information to investors and creditors.
"Too often private equity firms have destroyed companies and good jobs in this country, overburdening businesses with debt, charging exorbitant fees, and not investing in the future of the companies," Hoffa said. "Workers and investors have been kept in the dark long enough. It's time for disclosure and transparency."
In recent years, workers have paid a high price when private equity has taken over their company. For example:
- Since Kohlberg Kravis Roberts & Co. and its partner CD&R bought U.S. Foodservice, Inc., in 2007, Teamsters drivers have been forced to work 14-hour days in decrepit trucks. More than 1,400 driver and warehouse jobs were lost across the U.S. within a year. The company drew federal complaints for violations of almost 200 labor laws in Phoenix, which it settled by rehiring workers it had illegally fired.
- Since Madison Dearborn Partners bought VWR, a scientific equipment supplier, the company reversed more than 50 years of productive and cooperative relations with workers and their union. In California, the company has announced plans to close shop and relocate, illegally withholding information about where they will go, whether or not workers can follow the work and if they will maintain the current working conditions and standards.
"These private equity firms need to be reined in because they're undermining our country's goal of economic growth," Hoffa said.
Today, Hoffa sent a letter to Rep. Barney Frank, chairman of the House Committee on Financial Services, urging that the conference committee adopt the House restrictions on private equity.
"To protect jobs and the future stability of our economy, it is essential that we act now to regulate private investment funds," Hoffa wrote.
In the letter, he pointed out that defaults by companies bought by private equity firms could cause more job cuts and financial losses than the subprime mortgage crisis caused.
Founded in 1903, the International Brotherhood of Teamsters represents more than 1.4 million hardworking men and women in the United States, Canada and Puerto Rico.
SOURCE International Brotherhood of Teamsters