As AWG talks go on, RTX plans delivery

Though the Teamsters union and Associated Wholesale Grocers continue to negotiate a contract, Refrigerated Transport Express anticipates that its drivers will be hauling groceries for AWG April 2.

AWG has contracted with Refrigerated Transport Express to outsource its trucking operation if negotiations with the Teamsters are unsuccessful. Union officials said negotiations with management through March 15 dealt exclusively with warehouse workers: those portions of the contract that deal with trucking had yet to be discussed.

The 3-year-old contract between AWG and Teamsters expires April 1. The grocery cooperative employs 614 union members in Springfield.

Ron Petrikin, an attorney representing Refrigerated Transport Express, said RTX had "never had a situation where, when the parties have finally looked at numbers, that the union has been able to provide (savings) anywhere near the savings (the company) can derive from striking a deal with us."

As of March 16, the Teamsters were preparing for another round of talks with officials from AWG. Representatives for both AWG and the Teamsters said they anticipated more talks could be scheduled following those on March 16 and 17.

AWG has said that the company will outsource its warehouse and trucking operations in Springfield if it fails to get a money-saving contract with the union. Elite Logistics is the company that will operate the warehouse in Springfield, while RTX will perform trucking, both in lieu of union-affiliated AWG employees that now run those operations. Other companies have been tapped to take over the warehouse and trucking operations in AWG's Kansas City location.

Both Jim Kabell, business manager of the Teamsters Local 245 in Springfield, and Tim Bellanti, vice president of merchandising for AWG, said there was no limit on the amount of time each side was willing to spend negotiating a contract for both Springfield and Kansas City workers.

"Our first choice is to get an agreement with union leadership," Bellanti said.

Kabell said April 1 was not a firm deadline for the Teamsters.

"We want to work this out. We have no deadline. If we have an agreement April 1, great ... but if that agreement doesn't come until August 1, then we'll work with that," Kabell said.

Petrikin said his company doesn't think there will be an agreement at all between the union and the company.

"We are preparing for the possibility that we could be out of the picture following a deal with the union, but we don't anticipate doing that. We anticipate our owner/operators will be hauling groceries for AWG on April 2," Petrikin said.

Associated Wholesale Grocers officials have said the cooperative could save substantial money if it chooses to outsource with RTX, which would create owner/operator positions for AWG's trucking unit. All truckers for RTX are contract workers, Petrikin said. The company has more than 1,000 owner/operators and contracts with 10 to 15 major grocery companies across the country. With headquarters in Dallas, RTX has been in the trucking business for more than 50 years.

"For AWG, which is seeking a means of reducing transportation costs, this is one way to get out of the transportation business. There's substantial savings over what the union can propose by doing business with us," Petrikin said.

Kabell described the potential RTX contract as "union busting." Petrikin said RTX's operation does not lend itself to union representation.

"There are no unions among contract workers. It's not that we have anything against unions, it's just that we don't have the kind of business that would organize its workers in that way," Petrikin said.

Kabell said 100 percent of the dialogue during negotiations through the middle of March concerned warehouse workers, but that he thinks the company's "real goal is to kick 207 union drivers out of their jobs."

"There has not been a single proposal from the company regarding the drivers to this point," Kabell said March 15.

Bellanti said that it was the union that has been reluctant to talk about drivers.

"We're planning to talk about the drivers. We want to be able to provide contracts for both the warehouse workers and the drivers," Bellanti said.

Bellanti reiterated AWG's earlier statements that its first priority is to negotiate a contract with the union, but that so far the changes it has proposed to the union contract do not bring about the cost savings the company seeks.

Both Elite Logistics and RTX are preparing for an April 2 takeover. Elite held a job fair March 16 to inform current and possible new warehouse workers about jobs available at AWG's warehouse. RTX held meetings with truckers, explaining its owner/operator setup. To become an owner/operator, drivers must purchase a truck. RTX will own the AWG trailers. Independent operators own their trucks, and are responsible for the expenses related to it: maintenance and damage insurance. RTX provides a group medical plan and pays truckers on a revenue-sharing basis, per-trip, per-load. The owner/operator gets 70 percent of the revenue for a trip and load, while RTX retains 30 percent to recover its expenses, and, "we hope, a profit," Petrikin said.

Petrikin said RTX normally hires between 80 percent and 90 percent of the truckers a company employs when it takes over operations on a contract basis. RTX is involved in transition work in Springfield.

"There's no question, there are significant start-up expenses involved in recruiting owner/operators, completing the paperwork, training dispatchers, getting people ready and that is an expense RTX will incur ... but I don't anticipate that the company and the union will negotiate something that is comparable to our offer. I know from past experience, the union has never been able to offer concessions that come anywhere near the savings we can offer. Those savings are usually minuscule compared to the money we can save the company," Petrikin said.