On November 26, representatives of carhaul local unions overwhelmingly recommend that Allied Systems Holdings’ proposed purchase of PTS assets go out for a vote of the Allied membership.

PTS filed for bankruptcy under Chapter 11 of the Bankruptcy Code on November 19, 2007. Although PTS filed under Chapter 11, it appears unlikely that PTS will be reorganized and that the company will instead be auctioned off and liquidated.

This is the second time in less than two years that PTS has filed for bankruptcy. PTS previously filed for bankruptcy in January 2006. PTS cites lower volumes, higher fuel costs, and increased labor costs as the reasons for filing bankruptcy.

Allied has contacted the union with an interest in bidding on the assets of PTS. PTS has entered into a Letter of Intent for the sale of substantially all of its assets to Allied. Allied has submitted a $67-million bid to the bankruptcy court to purchase the assets of PTS.

In order for the proposed purchase to proceed, Allied Teamsters must vote to amend the terms and conditions of employment of PTS employees who will follow work to Allied under Allied’s proposed purchase of PTS. Those changes to the terms will mean that PTS workers would be paid at the lower pay rate approved by the Allied members in a vote earlier this year.

“The local union leaders recognize that this proposed purchase is the only viable chance to save 1,500 Teamster jobs at Performance Transportation Services,” said Fred Zuckerman, Director of the Teamsters Carhaul Division.

On November 21, 2007 the Teamsters National Automobile Transporters Industry Negotiating Committee (TNATINC) unanimously recommended that the proposal be sent to the Two-Person Committee of Allied Local Unions for its recommendation.

Ballots will be sent to Allied members on Monday, December 3, 2007.

Read letter sent to Allied Teamsters.

Read letter sent to PTS Teamsters.