Rather than getting court approval to borrow $142.5 million from Apollo Global Management, Yellow Corp. is looking into other loan options.
According to Reuters, Yellow has received similar loan offers from MFN Partners and Estes Express Lines. MFN Partners is an investment firm that owns 41% of Yellow’s stock.
On Aug. 6, Yellow filed for voluntary Chapter 11 bankruptcy with the District of Delaware Bankruptcy Court. In a news release, Yellow CEO Darren Hawkins shifted blame to the International Brotherhood of Teamsters for the company’s demise.
“All workers and employers should take note of our experience with the International Brotherhood of Teamsters (IBT) and worry,” Hawkins said in a statement. “We faced nine months of union intransigence, bullying and deliberately destructive tactics. A company has the right to manage its own operations, but as we have experienced, IBT leadership was able to halt our business plan, literally driving our company out of business, despite every effort to work with them.”
However, Teamsters General President Sean M. O’Brien fired back.
“Yellow may try to use the courts to eradicate its financial responsibilities, but they can’t escape the truth,” O’Brien said in a statement. “Teamster families sacrificed billions of dollars in wages, benefits, and retirement security to rescue Yellow. The company blew through a $700 million government bailout. But Yellow’s dysfunctional, greedy C-suite failed to take responsibility for squandering all that cash. They still don’t. They shamelessly pin their corporate incompetence on working people. This is what’s wrong with Big Business. This is a reminder of why workers’ ability to organize and collectively bargain is so crucial to protecting and creating good jobs in America.”
Yellow class-action lawsuit
On Aug. 1, Armando Rivera filed a class-action lawsuit in a Delaware federal court against Yellow. The lawsuit claims that the company violated the WARN Act by not providing 60 days advance written notice of terminations.
According to the Department of Labor, The WARN Act requires employers with 100 or more full-time employees to provide at least 60 calendar days advance written notice of a worksite closing affecting 50 or more employees, or a mass layoff affecting at least 50 employees and one-third of the worksite’s total workforce or 500 or more employees at the single site of employment during any 90-day period.
Not all dislocations require a 60-day notice. The WARN Act makes certain exceptions to the requirements when employers can show that layoffs or worksite closings occur due to faltering companies, unforeseen business circumstances and natural disasters. In such instances, the WARN Act requires employers to provide as much notice to their employees as possible.
The lawsuit comes shortly after news of Yellow ceasing operations and filing for bankruptcy. LL
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