Union Members Return to Work at Oak Harbor Without Contract
By Rip Watson, Senior Reporter
This story appears in the March 9 print edition of Transport Topics.
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Striking Teamsters are returning to work at Oak Harbor Freight Lines without obtaining a new labor contract but ending a walkout that lasted more than five months at the regional less-than-truckload carrier.
Company spokesman Mike Hobby told Transport Topics March 2 that it is “business as usual” for the Auburn, Wash.-based company, which continued regular operations since the walkout started in late September.
The Teamsters Union represents workers at 12 Oak Harbor terminals out of 33 operated by the company, and about 40% of Oak Harbor’s workforce were union members at the start of the walkout.
To keep freight moving, the privately held company hired new employees and transferred workers from nonunion terminals.
The union’s contract with the company expired Oct. 31, 2007. A federal mediator entered the talks last summer. During the strike, two negotiating sessions were conducted.
The strike coincided with the economic downturn, leaving the carrier with nearly 40% less business, measured by bill counts, than at this time last year.
“The economy had more of an impact on our business overall than the strike,” Hobby said. To illustrate that point, he said other LTL carriers’ freight bill counts are off 20% to 30% compared with last year.
Teamsters Vice President Al Hobart told Transport Topics in an e-mail that, “due to the effectiveness of the strike and the economic downturn, Oak Harbor has been forced to cut its workforce by over 50% from pre-strike levels.”
Hobart said 277 Teamsters would be working at the company when the return-to-work process is done. Hobby said 538 union workers were employed when the strike began.
Hobby said that 136 union members returned to work at Oak Harbor during the walkout.
The first workers began to return on Feb. 25, 13 days after the union made an unconditional offer to below analyst expectations, as the housing downturn hurt home appliance sales at its domestic Sears locations.
The company has been closing unprofitable stores — 28 during the fiscal year and another 24 announced Feb. 26 — and Chairman Eddie Lampert said there may be more to come.
Kohl’s is taking the opposite tack, opening 55 locations this year. That’s down from the 75 it opened last year, but up from the 50 it originally planned. Most of the openings are in former Mervyns locations Kohl’s bought in December.
Despite a grim outlook for the year, it hopes to gain market share by expanding into the stores Mervyns used to fill and promoting itself as a lower-priced shopping option.
Kohl’s saw its fourth-quarter profit fall 18% to $336 million, or $1.10 per share, from $412 million, or $1.31 per share a year ago. That beat analyst forecasts, but the company’s full-year guidance fell short of what analysts expected.
Gap also is focusing its attention on the same things customers are. The company is working in particular to turn around its lower-priced Old Navy division, which has dragged down the overall business.
The company, which also operates its namesake stores and Banana Republic, saw its fourth-quarter profit fall 8%, but results beat analyst expectations as the company controlled expenses and kept a clamp on inventory. Sales fell 13% to $4.08 billion.
Gap said it plans to decrease square footage by about 2% in 2009, opening 50 stores and shuttering 100, weighted toward Gap stores. It is cutting capital spending by about 19%.
