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.
James
I worked for Roadway express for about 20 years. Then Yellow came in and bought us. The companies were merged into one called YRC freight. In the global economic collapse of 2008 the company almost went bankrupt then. The Teamsters membership voted on and agreed to give back 15% of our weekly pay, one week of vacation, and 5 minutes of our 2 daily breaks, a suspension of pension fund contributions, and other work rules concessions. Which were never reinstated. Even with all of this financial help from the employees Yellow’s management is so incompetent that they still are struggling to make a profit. Yellow always was a garbage managed company and they still are. They received a $700million pandemic loan that the american taxpayers will have to eat, on top of the billions of dollars in employee give backs over the last 15 years and they are still so dysfunctional and incompetent that the end is finally here. I’m retired now and watching this from the sidelines. Yellow destroyed Roadway Express and USF. If yellow management is allowed to walk away from this without losing their salaries and bonuses,lol, and retirement parachutes it will be a sad day indeed.
Anonymous Citizen
While I feel bad for everyone involved, except for the top tier executives that continued to rake in millions, it has been clear for a decade or two that Yellow, or YRC was a failing company. While the union may have strongarmed this time when the restructuring was clearly needed, in the past they have given millions in concessions in order for the company to limp along, continuing to lose money through mismanagement and greed. Anyone with a vested pension should have bailed out long ago, with the writing on the wall so evident throughout the years. Anyone not vested should have cut their losses and moved on when freight levels were strong and jobs were plentiful. It is an unfortunate situation, but one that most everyone has seen coming for a very long time. While the 30K employees will certainly bear the brunt of the hardships from this debacle, let us not forget that the American taxpayers are also going to suffer a loss, to the tune of more than a half of a billion dollars when all is said and done.
Ka
Wait you mean O’Briens 4d chess strategy of ignoring the problem and insulting mgmt for Months didn’t work to solve it??
22k union jobs down the drain.
Jade
Quit blaming your employees for your reckless spending. You are the business end, but continue to blame the IBT. You are truly disgusting.
Ka
Lol teamsters did a great job managing this one.
22k jobs down the drain.
Al
I think if you would have ask the majority of the workers represented by the Teamsters, they would prefer to have their jobs at the current level of pay and healthcare. Along with supporting the companies initiatives the go to One Yellow. Unfortunately, being a member of the Teamsters doesn’t allow you to voice your opinion or vote on those initiatives. Sure u pay dues, but they control you. Period. Your leadership decided to roll the dice, and it cost you your jobs. Not their jobs, yours! They still get paid and keep their jobs.
When the creditor’s start calling, just forward those calls to the Teamster leadership offices. Maybe they’ll pay them for you? NOT!
Once again. Another example of the minority controlling the majority. Unions only protect the ones that don’t want to work. I’m this case drivers not wanting to work the dock. Very small percentage that ultimately cost 22,000 members their jobs! Thank one of them if you see them OK. Best of luck 🤞
Craig
Company has been mismanaged for years. It’s a shame Yellow took a good powerful depth free company and ran it into the ground. What a shame. Sad to say Management did this not the union. Better off let it go.
Jay Lundry
I was so proud to drive for Yellow right out of trucking school & loved the history of Yellow & Roadway! I was so proud to have been a small part of that even only for a few months! I had a great line-haul manager, Andrew! Him & the dispatchers were great! As for the union, the business manager for Local 455 would call me trying to get me upset with the company for no reason! He never would assist me with anything, just ran his mouth! I found the union hindered training & advancement! They were annoying & useless! Honestly, Bill Zollars is the guy to blame for this mess, but the union could have helped the company with it’s One Yellow plan and chose not to! Darrin Hawkins never has a chance when he took over in 2018. So, don’t blame him! I believe the union turned it’s back on the 22,000 teamsters these past 8 months! This is truly a very sad day for America! God speed Yellow!