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 Wood
A miracle they survived this long. Zollars gave them terminal cancer over a decade ago
Pray America
Teamsters and drivers are unreasonable. They feel they should earn the same money as a doctor who dedicated their life’s to educate themselves to help people. Teamsters management are complete flunkies who could never run a successful business but other ignorant people will follow them and shut companies down.
Another great job by the Teamsters successfully shutting another company down one less company in america – idiots they should be ashamed of themselves.
William Campbell
This is a great move on behalf of Yellow to start eliminating the power of union control. This is what UPS should have done and those under national freight agreement. All these unions are causing inflation and possibly recession down the road. I encourage all Americans to not use union carriers to deliver products to your business and home.
Diane Flores
Started with Roadway in Spring of 1996. After all the bail outs and the concessions from the teamsters, shame on them for stating it is the teamsters faults!
cfdockman
Went through this twenty one years ago. Good luck to everyone.
Blame The Teamsters
The headline should be:
“Teamster President Sean O’Brien loses 22,000 jobs”
The blame rests entirely on the union for the closure. Yellow mgmt tried to provide a plan early on to get a much needed contract to streamline the operation and compete in the current market. The outdated and uncompetitive work rules no longer allowed the company to compete in the market and without the changes this is what you have.
In the coming weeks you will see how good you had it and you will appreciate the job and benefits you had. You had a job that including paid benefits by Yellow worked out to $45-50/hr. You had a company paid pension, no more.
Once again, you can bring up all the excuses you want but in the end, the union cost the jobs of 30,000 people of which 22,000 were Teamsters.
Rodney Logan
It’s really a shame that with all that money they received from the government.
They mess up a lot of people’s lives that is what greed does
Mike K
This is all yellow fault. They always mismanaged money delayed freight and drivers, governed speed in their trucks, where as we could have been pushing more freight if the trucks could roll faster than 63mph while most posted speed limits were over 70 to 80mph only because they want to save on fuel. I don’t get how a company can spend 700 million within 2.5 years and not make up most of it back from the shippers. I’m not sure how much of that was stolen by the ceo, but it’s ridiculous that they want to blame the union. The ibt did the same thing with abf and ups and they were able to agree and continue on. The blame game is all due to yellows failure of mismanagement plus hired more employees than they needed or had use for including UPPER MANAGEMENT’S uncles and aunts with no experience. If they were to keep average amount of SMART employees and system they wouldn’t have shut down today. Employees were upset beciase they gave so much to keep this company aflot while upper management including ceo kept taking bonuses and raises in return ceo of this company couldnt even keep them employeed.. BTW yellow was a great company thanks to its union employees and I’m sad to see it go.