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.
Mike
Not that I am involved in this terrible situation and still feel terrible for Yellow Teamster and all Yellow employees. Yet the question needs to be asked. What have all of Yellow Freight Senior Management Executives, monetarily walked away with from all this? I believe there needs to be an investigation by the DOJ over what’s been happening since the $700 million was handed to them. And in total with the loans over 20 years to the tune of $1.666 billion, why did that company still have a debt of between $1.3 and $1.5 billion?
Eva
My heart is broken and sick for all of my Yellow family that lost their jobs today. Grateful I still have a job for now. Senseless that the union and management let this happen. No winners here except the big guys that continue living in their mansions. All the employees union and non union are the losers here.
James Coleman
This is so sad to hear.
Carol Ann MacKay
To all who are placing the blame for Yellow’s demise on the Teamsters . . . that is what constitutes “Dream World and Voodoo Economics”! Remember the “trickle down Theory of Economics” which from the start was and continues to be “The Trickled On Theory of Economics”! WHAT EVER HAPPENED TO HSR LAW? That Yellow was even allowed to purchase Roadway, which was and had been profitable, was an unbelievable act of hubris on Yellow’s part; an act of unrepentant greed on Roadway’s part, and multiple acts of criminal negligence on the part of the government in failing to do its due diligence! The US government should never have allowed the
sale! Yellow had to borrow hundreds of millions of dollars to purchase Roadway! Yellow started out bankrupt, and you of little knowledge and intellect, who blame the IBT, are blinded by their ignorance! LOOK AT THE HISTORY! THE IBT GAVE UP PENSION CONTRIBUTIONS, TOOK A PAY CUT AND AGREED TO A TWO TIER WAGE SYSTEM to help Yellow bail itself out of the dire situation into which they put themselves, and increased their morass of mismanagement, day by day by day! SO YA, THAT IBT REALLY SCREWED YELLOW! NOT! YELLOW SCREWED THE IBT, THE BANKS AND WE THE PEOPLE! PERIOD! Any belief to the contrary is unmitigated ignorance!
THEN, in an illegal act of political cronyism, which was greatly protested on all sides, except for the fascist traitor Trump AND the Trump/Kushner Criminal Enterprise, which was trying to insure continued political contributions to Trump, SO . . . HE ARRANGED FOR AND APPROVED A $720,000,000.00 LOAN, TO AN ALREADY BANKRUPT, MISMANAGED BEYOND BELIEF, SO UNDERWATER IT WAS DEEPER THAN THE CHALLENGER DEEP, YRC (YELLOW)! Basically, from the time Yellow (a company already beginning to show signs of circling the bankruptcy drain) purchased, or more appropriately, when the banks purchased Roadway and let Yellow manage the entities, VIRTUALLY EVERY THING YELLOW DID WAS MISMANAGEMENT, BLEADING THE IBT TO SURVIVE, AND PUT THEMSELVES ON A COLISSION COURSE WITH BANKRUPTCY. ANYONE WHO BELIEVES THE IBT IS RESPONSIBLE FOR YELLOW’S SELF-INFLICTED DEMISE, I’ve got this lake bottom floating (well not so much any more) bridge here in Seattle I’d be happy to sell you!
John Kopp
Yellow management, who runs your company. Stop blaming everyone else. You’ve done a lousy job running that company since 2005.
ScottyHottWheels
So I guess this means that all of us that weren’t receiving Union wages and benefits but have been paying taxes now are going to have to bail you bunch of deadbeats out
Angie Morgan
My daughter was suddenly locked out of the computer while working this morning saying her sign on was no longer recognized. After 10 years of service to the day, thats how she’s told she no longer has a job. They sure lived up to the name YELLOW. Couldn’t even do it in person.
Local 383
Greedy Teamsters, it’s all their fault.