SPECIAL REPORT: Highland to begin terminating drivers

TORONTO — New talks between TransForce and the union representing owner-operators at its Highland Transport division did not produce an agreeable settlement that would have saved the drivers’ jobs.

The failed negotiations between Highland management and the Steelworkers Local 1976 yesterday also means that there is little guarantee the carrier will continue to operate long-term — at least not in its present form.

Todaystrucking.com learned yesterday that parent company TransForce threatened to shut down the truckload and intermodal carrier if the owner-ops voted to reject immediate changes to their current collective contract, which runs out in December 2008. And last week, the contracted drivers did just that — unanimously.

This morning, Highland management sent a message to the union indicating that as a consequence of the workers turning down the new package and stating they would grieve changes to the existing collective agreement, the firm has little choice but to terminate 25 to 50 owner-operators within "the next few days."

The notice, obtained by Todaystrucking.com, goes on to state that the company will begin working with its customers for an orderly withdrawal of service. "After that, we will review and continue with further terminations."

"We are well aware of the hurt that this may cause. However, we are losing … and can’t continue to do so."

We’re told that various carriers, including other TransForce
divisions, are watching the Highland situation closely.

Technically, any owner-op that showed up for work this week would be agreeing to operate under the company’s new terms. It’s unclear at this point how many have already done so or plan to resume hauling in the next few days, says Dorothy Sanderson, health and safety rep for the owner-ops.

"If you are hungry enough and in debt enough you will do anything," she says. "It is difficult to predict."

Clearly, the drivers didn’t take their own union’s advice weeks ago when it recommended that members accept the new terms in order to remain employed.

In a notice to members at the time, the union acknowledged that an independent review of the company’s financial statements confirmed that the carrier indeed is in "financial difficulty" and the "ongoing operation of the company is in jeopardy."

Apparently, though, some of the sacrifices the owner-ops were asked to make were too big.

They included: An across the board reduction of 2.5 cents per mile for both loaded and empty miles; a 65 percent cut for container loads paid by percentage; an owner-operator co-pay charge of 40 percent for benefits; the replacement of a fuel cap and mpg bonus with a fuel surcharge where the operator pays for the full cost of the fuel upfront; and, among other things, the demand that units maintain an 8.5 mpg standard.

It’s rumored that the first round of cuts will be to those owner-ops that have not been able to reach a mandated mpg benchmark below that rate.

Despite Highland’s troubles, TransForce as a group reported increased second quarter revenues by 20 percent for a record $595.6 million — mainly on the strength of fleet acquisitions and fuel surcharges collected from customers.

Needless to say, we’re told that with so many central Canadian carriers facing similar issues (unionized or not), others in the industry in this region are paying close attention to this situation.