Friday, July 10, 2009

Multi-employer pension blues

The Kansas City Star is reporting that trucking giant YRC Worldwide, Inc., which operates the Yellow and Roadway brands, reached a deal on concessions with the Teamsters Union.

Amidst rumors of an impending bankruptcy filing, the Star reports that Tenex Capital Management will guide YRC through a restructuring--not a bankruptcy.

Like most large firms, YRC has lost business because of the recession. But the Kansas-based corporation pays into a multi-employer pension fund, one that compels YRC to direct about half of its contributions to employees who never work for it.

As I've reported several times, it believed part of the push by unions to pass the co-called Employee Free Choice Act is to bail out troubled multi-employer pensions.

Such plans are commonly known as "Last man standing."

Think about that for a while.

Related post:

Report from the bloggers' conference call on EFCA and under-funded pensions

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