New 3-Year Freight Contract Gets Tentative OK

The Teamsters union and the trucking industry reached tentative agreement Thursday on a new three-year national freight contract covering 200,000 drivers and warehouse workers.

The new National Master Freight Agreement, unless rejected by at least two-thirds of the affected union members, will replace a contract of similar length that expired at midnight Thursday.

Terms of the accord were not disclosed. But Teamsters President Jackie Presser said in a statement that it “addresses the economic needs of our members and advances their legitimate claims for job security.”

Under the expiring contract with Trucking Management Inc., the industry’s primary collective bargaining arm, the base rate for drivers on a carrier’s payroll for three or more years was $14.71 an hour.

Leaders Under Pressure

Including fringe and pension benefits, the industry had calculated its total labor costs at $23 an hour.

Going into the negotiations, Teamster leaders were under pressure from two directions after giving up automatic cost-of-living adjustments and allowing lower wage rates for new hires and part-time “casual” workers in the 1985 contract.

While some large carriers are enjoying fairly healthy profits despite freight rate-cutting wars resulting from deregulation, several unionized smaller companies are having financial troubles.

Union officials acknowledged that their members employed by the larger carriers were most interested in wage and benefit gains, while those working for smaller companies wanted more emphasis on job security in the bargaining.

Since government deregulation of the trucking industry in 1980, the Teamsters have lost 120,000 members to new non-union companies, many of them subsidiaries of unionized carriers who are party to the Master Freight Agreement.

At least 78 Teamster-organized carriers have declared bankruptcy, been swallowed up in mergers or acquisitions or have gone out of business in the past eight years, according to union figures.

“Negotiations were difficult because the industry is in financial chaos,” Presser said Thursday, encouraging support for ratification.

Arthur Bunte Jr., the industry’s chief management negotiator, indicated that turmoil is likely to continue.

“In the outcome of these talks, we do not feel we were successful in convincing the union of the harsh competitive realities facing our members in the marketplace,” Bunte said.

Strike Never Mentioned

But there was little evidence of rancor between the two sides in the two months of negotiations during the past two months here and in Arizona, where Presser is recovering from cancer treatments while awaiting trial in July in Cleveland on federal racketeering charges.

Neither side ever mentioned the possibility of a strike. The last time there was a labor disruption over a nationwide trucking contract was in 1979, when the Teamsters struck selected carriers for 10 days.

Presser is accused of paying salaries to two people who did no work for the union from the payroll of a Teamsters local in Cleveland that he also heads. His lawyers have contended that Presser was told by the FBI to keep the two men on his payroll in its use of him as a government informant.

While the terms of the new contract were not announced Thursday, Ken Paff, an organizer for a dissident faction, Teamsters for a Democratic Union, said it reportedly compresses the span for new hires to reach the top base scale from three years to 18 months.

The dissidents had complained that the 1985 contract allowing companies to pay new hires only 70% of the base wage gave the biggest companies with the most new hires an advantage in driving out of business smaller firms with more veteran workers on their payrolls.

“They’ve made some change, but it’s still not acceptable to us,” Paff said of the new contract. “It’s a big issue because people shift around a lot in this industry.”

Paff’s group had said earlier that negotiators for the two sides had reached an “understanding” to raise the hourly base wage rate in the range of 30 cents a year and increase benefits by about 20 cents an hour each year.

But Paff emphasized Thursday that he has no definite knowledge of the exact terms of the new contract.

Chip Roth, a spokesman for the union, said terms of the tentative contract will not be announced until April 7, when negotiators are to present it to the presidents of Teamster freight locals at a meeting in Chicago.

Ballots for the ratification vote will be mailed to Teamster freight members in about two weeks, Roth said.

The union’s schedule calls for counting the ballots and announcing the results in mid-May.