Yellow, the third-largest less-than-truckload company that’s in the midst of financial chaos, said in a memo to laid-off, nonunion employees viewed by FreightWaves that the company is “shutting down regular operations” on Friday.
All locations will be closed and/or lay off some number of employees. As the memo stated:
“We regret to inform you that your employment with Yellow Corporation, or one of its subsidiaries, (collectively referred to as the ‘Company’) will permanently terminate on July 28, 2023, or within 14 days after (the ‘Separation Date’). The Company is shutting down its regular operations on July 28, 2023, closing and/or laying off employees at all of its locations, including yours (the ‘Shut Down’).”
The company on Friday morning laid off an unknown number of office employees, most of which were nonunion. It said in a memo to the laid-off employees that it was unable to alert them previously of this closing of business “because the Shut Down was not reasonably foreseeable.”
John Murphy, who is the Teamsters National Freight director, advised union employees to collect their belongings from all offices and terminals, in the case that Yellow shutters in the coming days and facilities are not accessible.
Murphy noted Teamsters is continuing to look for financing solutions for Yellow. However, he wrote, “the likelihood that Yellow will survive is increasingly bleak. Yellow continues to clear its system, and it appears to be laying off personnel and closing entire terminals across the country. All Yellow employees should, in our opinion, prepare for the worst, as Yellow appears to be headed to a complete shutdown within the next few days.”
Employees were notified of the layoffs on Friday morning in voice-only calls. At least three executives laid off large portions of their teams:
- Yellow Chief Information Officer Annlea Rumfola informed her team of some 300 technology employees that Friday was their last day, according to an employee on the call.
- Steve Selvig, vice president of customer care at Yellow, informed an unknown number of customer service employees that Friday was their last day, according to an employee on the call and a local news publication.
- Yellow Chief Commercial Officer Jason Bergman invited the following teams to a call that said Friday was their last day: local sales divisions 1, 2 and 4; all inside sales; multiple regions of corporate sales; exhibit operations managers; and Yellow third-party logistics sales. This came from two employees on the call. FreightWaves reviewed screenshots of emails sent before and a recording of the call. A Yellow representative told FreightWaves after publication that not all teams invited were laid off.
These layoffs come ahead of a potential Yellow bankruptcy filing. A senior vice president said Yellow is expected to file for bankruptcy on Monday, according to three employees who attended an internal call in which the executive shared this news.
Terminated employees were instructed to receive information regarding their severance pay, health care, W-2s, and other key documents through an Oracle platform, as their access to company systems will be terminated on Friday. According to a memo distributed to terminated employees viewed by FreightWaves, severance for nonunion workers depends on title and length of tenure at the company:
It’s unclear why the Yellow third-party logistics sales team was invited to the layoff call, as the company is actively seeking to sell its logistics arm. A Yellow representative said in an emailed statement after the story was published that the Yellow Logistics organization has remained intact, including the Yellow Logistics salesforce.
A Yellow representative said in an emailed statement to FreightWaves after the story was published that customers can contact Yellow’s support line at 800-610-6500 or customer.care@myyellow.com.
“Yellow has retained a robust customer service team that is fully capable of handling inquiries and assisting with all support that customers might need,” the representative said.
Yellow, a 99-year-old company headquartered in Nashville, Tennessee, employs some 30,000 workers. About 22,000 of them are represented by the Teamsters union. Teamsters and Yellow have been locked in a monthslong strife over changing key work rules at the trucking fleet. Now, sources say Yellow may file for bankruptcy imminently.
In a call to Yellow sales teams, Bergman shared a statement on the company’s potential shuttering — and pinned the blame on the Teamsters’ refusal to negotiate with the company:
“Since last January, we have made every attempt to meet with the IBT. The IBT’S refusal to negotiate for nine months, its freezing of our essential business plan, One Yellow and, finally, its strike authorizations caused customers to find alternative freight carriers and it’s had a catastrophic effect on our business. When IBT leaders were finally ready to meet this week, it was too late. By then, the IBT strike threat had already a devastating impact on our business, [unclear] investors and causing customers to quickly depart. Given this impact to our business, we are forced to announce additional headcount reductions of non-union employees.”
In a memo published to members Thursday night, Teamsters blamed Yellow’s management for the company’s financial issues:
“In the meantime, TNFINC and the IBT continue to try to work with the Government to determine whether there is a way to protect the Teamster families at Yellow. TNFINC and the IBT remain willing to work with Yellow and its lenders or potential lenders. Hope, however, is fading. Unfortunately, despite more than a decade of concessions totaling billions of dollars given to the Company by Teamster members as well as a massive government bailout loan in 2020, Yellow may finally be succumbing to its enormous debt burden.”
This story is developing. Check back here for updates.
Are you a Yellow employee with a story to share? Email rpremack@freightwaves.com.
Bob
The unions killed this company. Great job Union…instead of a pay increase all you have done for your members is get them pink slips.
J Harris
The union is EXACTLY why this company failed. It is also why every democrat has been funneling tax payor dollars to the company for 15 years in one form or another. ( and sadly, including Trump unfortunately ) Teamsters make overwhelmingly more democrats by their votes.
The union is why all of the teamster companies folded since deregulation.
First, the union leadership is corrupt.
Second, with slim profit margins in the LTL sector, there is NOT room to have a company, have a union, tell the company how to operate their business. There are so many government protections, fed and state, now for the average worker, ( FMLA ETC ) that the union is obsolete, and just puts the company on a footing where they can NOT compete with more streamlined non union companies.
There was a point and time in our country’s history where unions were needed. That has long since past, and they are now just a new avenue to exploit the worker, by the politicians, and the fatcats in the union’s leadership.
Jeff
Here is an excerpt of the notice the ENTIRE IT department was given:
“Notice of Separation & General Release of Claims
We regret to inform you that your employment with Yellow Corporation, or one of its subsidiaries,
(collectively referred to as the “Company”) will permanently terminate on July 28, 2023, or within 14 days
after (the “Separation Date”). The Company is shutting down its regular operations on July 28, 2023,
closing and/or laying off employees at all of its locations, including yours (the “Shut Down”). The
Company submits this notice to you in part to satisfy any obligation that may exist under the federal Worker
Adjustment and Retraining Notification Act, 29 U.S.C. § 2101 et seq. and applicable similar state laws
(collectively, the “WARN Act”). The Company does not admit that such laws apply or that notice is
required. If no obligations exist, this notice is being provided to you voluntarily. The Company was not
able to provide earlier notice of the Shut Down as it qualifies under the “unforeseeable business
circumstances,” “faltering company,” and “liquidating fiduciary” exceptions set forth in the WARN Acts.
The Company expects all layoffs and location closures relating to the Shutdown to be permanent. You are
not subject to a job bumping system – that is, Company employees will not be able to displace more junior
employees out of their job positions as a result of the Shut Down. This notice and the Release of Claims
(“Release”), below, cover various matters related to your separation, and they are being provided as soon
as practicable because the Shut Down was not reasonably foreseeable.”
BOB CONRAD
jUST LIKE TWITTER AND THE REST OF SOCIAL MEDIA. RAN BY CENSORING NAZIS.
George Koumarianos
There will be 1 food manufacturer, 1 trucking company, 1 pharmaceutical company, 1 water distributor, 1 religion, 1 military, 1 religion and one GOVERNMENT. If you’re. You there, in the back, calling me crazy, I’ll be laughing last when you’re scanning your hand for food and have no freedom of speech. GODF BLESS US ALL not seeing what’s going on you better take your blinders off and look around at this world. HUMANS are doomed. GOD BLESS EVERYONE. BE SAFE AND DO NOT TRUST THE GOVERNMENT
George S.
Yellow management can point the fingers all they want but the facts are out there and the facts speak loudly to why Yellow has failed… and it isn’t the union. Three rounds of concessions over twenty years from union employees, numerous rounds of restructuring of their debt with lenders and and $700M bailout loan from the government… and Yellow STILL can’t pull a profitable quarter , let alone a profitable year.
Their solution? Ask the union to essentially toss the labor agreement out the window and agree to work rules that would essentially make being on a union job meaningless, not to mention strip away almost a hundred years of precedent. And whole Yellow claims this is the ONLY way they can survive and become a viable enterprise again.
My response-as it always is to Yellow’s whining—is to point at ABF Freight, which has similar work rules and language and far higher labors costs—and ask why ABF is consistently profitable and Yellow is consistently in the red?
The answer so simple: the quality of the management… plain and simple and glaringly obvious.
Kevin
Horrible management thats all that needs to b said
Brent Peterson
Yellow has certainly been mismanaged for YEARS. However, at this critical juncture, the Union is to blame. Teamsters APPROVED the One Yellow plan. It was implemented in the West. Then they objected to it at Holland & YRC. “Union work rules and contract” arguments. Etc..The momentum was killed and customers questioned the direction of the company. Why not wait until Spring at contract time? Allow the plan to finish..then sort out the details. By July we’re bleeding out by millions of dollars per day. Now we have no choice but to go bankrupt because we have no customers. Well played everyone!! Union stubborness was the final nail in the coffin. Now we ALL must start over at square one. Hope you’re happy O’Brien. 100 years down the drain.