TEAMSTERS CALL ON FEDERAL GOVERNMENT TO REFORM CORPORATE BANKRUPTCY LAWS

Companies Like Yellow Should Not Be Able to Escape Accountability, O'Brien Says

WASHINGTON, Aug. 8, 2023 /PRNewswire/ -- The Teamsters Union is calling on the federal government to reform corporate bankruptcy laws following Yellow Corp.'s filing for Chapter 11 this week. The freight company's closure leaves 22,000 union members without work despite Teamsters at Yellow giving back more than $5 billion in wages and benefits since 2009.

"Corporate bankruptcy legislation in the U.S. is a joke. The rules are written to favor corporations in this country, not working people. We see this with federal labor laws as well with workers fighting an unequal system for more than 400 days to get a union contract. Workers need real relief and protection," said Teamsters General President Sean M. O'Brien. "Perennially mismanaged companies like Yellow should not be able to find safe harbor from accountability by simply filing for bankruptcy. Hardworking people routinely get left behind in this process when they should be at the front of the line to be paid and protected for the sacrifices they make to American employers."

The Teamsters are calling on Congress and the White House to pass and enact new legislation that prioritizes workers throughout the corporate bankruptcy process. Legal safeguards must be established to protect earned pension credits and retirement benefits and ensure payment of severance money owed to workers.

The union also demands new regulations to protect existing collective bargaining agreements to guarantee contracts are honored on the other side of bankruptcy by any future employers.

"As in the case of Hostess or what may be the future of Yellow Corp., existing investors or new buyers are allowed to purchase failed companies with the sole intent of restructuring them to kill labor contracts and bust unions," said Teamsters General Secretary-Treasurer Fred Zuckerman. "This cannot continue to be the status quo in America, not when workers are being robbed of their wages and retirement because of corporate incompetence. The preservation of jobs and benefits to workers must be the primary objectives of Chapter 11, but they aren't, and it has to change."

Historically, the Teamsters have advocated for the Protecting Employees and Retirees in Business Bankruptcies Act, legislation last introduced in 2020 by Sen. Dick Durbin (D-IL) and Rep. Jerry Nadler (D-NY). The existing bill or other legislation to be introduced must create a fair and equitable bankruptcy system that puts workers and retirees at the forefront.

With the Yellow bankruptcy filing late Sunday, rank-and-file Teamsters are reminded that workers at the 99-year-old freight company are, in fact, Yellow's largest uncredited creditor. Since 2009, Teamsters sacrificed more than $5 billion in wage and benefit concessions to keep the company moving. These givebacks included more than $3.7 billion in voluntary wage cuts and more than $1.4 billion in pension benefit reductions.

In addition to being routinely rescued by its Teamsters workforce, Yellow still owes hundreds of millions of dollars to the federal government in bailout money and more than $750 million to Apollo Global Management.

"Despite its extraordinary debt, Yellow owes more to the workers who kept it running than to anyone else. Yet existing bankruptcy rules encourage corporate vultures to pick apart workers' bones, shred union contracts, and kill off companies," O'Brien said. "Yellow's collapse should bring deep shame to its corrupt management team, but it is an opportunity for unions, workers, and elected officials to take real steps to protect working people during such devastation. We need to enact new laws that safeguard American families from the greed and mismanagement of any employer."

The Teamsters will ask every member of the U.S. House of Representatives and Senate to support legislation that protects workers during bankruptcy, particularly elected officials in jurisdictions facing heavy job losses from Yellow's destruction.

Founded in 1903, the Teamsters Union represents 1.2 million hardworking people in the U.S., Canada, and Puerto Rico. Visit Teamster.org to learn more and follow us on Twitter @Teamsters and on Facebook at Facebook.com/teamsters.

Contact:
Daniel Moskowitz, (770) 262-4971
[email protected]

SOURCE International Brotherhood of Teamsters