Today, a U.S. Bankruptcy Court Judge granted Allied Holding’s request to cut Teamsters’ wages by 10 percent and block a 3-percent pay raise that was scheduled to take effect June 1.

The 3-percent pay raise that had been scheduled to take effect June 1 consists of a 2-percent pay hike negotiated in the National Master Automobile Transporters Agreement (NMATA), and a 1 percent cost-of-living adjustment (COLA).

“We’re very disappointed by the judge’s decision,” said Fred Zuckerman, Director of the Teamsters Carhaul Division. “However, we will continue to fight on our members’ behalf and make sure we keep members informed about the bankruptcy proceedings.”

During a two-day hearing last week in the court’s Northern Georgia District, Judge C. Ray Mullins heard evidence presented by the union and Allied.

The judge concluded today that Allied is suffering from a cash crisis and the cuts in wages are necessary for it to stay in business.

The union disagreed, arguing that there is no evidence Allied is losing money, and that the company is being mismanaged, among other internal problems.

The union has said that its members at Allied may leave to work for other car- and truck-haul companies.

In court today, Judge Mullins, said, “I don’t think you factor that in,” regarding the possibility of drivers leaving to work for other companies.

But, the judge admitted, “If workers, in a large enough number, decide not to work, they can shut the place down.” That scenario, the judge said, could be the “death knell” to the business.

The judge also acknowledged that there are real problems with mismanagement at the company.

Last Friday, the company sent another letter to Allied workers, containing a chart that alleges that non-union workers have sacrificed more than union workers during the bankruptcy proceedings.

However, the chart does not factor in the bonuses managers have received. Once those are factored, managers are earning more than before the bankruptcy was filed.