Employees at Yellow Logistics confirmed to FreightWaves they were terminated Tuesday as part of widespread layoffs at the independent subsidiary of Yellow Corp. But whether this was tied to an actual shutdown of the 3PL was not clear Tuesday night.
One employee said all staff were given short notice to dial into a company-wide conference call. On the call, employees were told there was no more money to fund the operation and they were being terminated.
In recent days, parent company Yellow (NASDAQ: YELL) had said “it’s business as usual” at the business formerly known as HNRY Logistics. Yellow announced last week it was shopping the unit that specializes in truckload shipments, contract logistics and warehousing and distribution services, presumably trying to offload it ahead of a bankruptcy filing.
Another employee said the entire unit, roughly 100 to 150 people including managers, were let go Tuesday.
Yellow hasn’t commented since leadership at the Teamsters union said late Sunday night it was notified the company was filing for bankruptcy. Just hours prior to that announcement, Yellow closed the gates at its terminals and posted signs saying all company operations had ceased.
Most of its nonunion workforce had been let go Friday.
The company had been losing customers for weeks as speculation of a potential shutdown grew. In a public back-and-forth with union leadership over operational changes the less-than-truckload carrier said it could be out of money as soon as July.
Attempting to preserve cash, it missed required contribution payments to health care and pension funds on July 15, prompting members of operating companies Holland and YRC Freight to issue a strike notice. The planned work stoppage would ultimately be called off at the last minute when the fund it contributes to extended health insurance for those employees. However, the damage was done as the threat of a shutdown hastened the rate at which intermediaries and customers diverted freight from its network.
Yellow was reported Tuesday to be close to a deal to receive debtor-in-possession financing from one of its current lenders, Apollo Global Management (NYSE: APO). The infusion would place the investment firm atop others in a liquidation scenario, a process that would attempt to satisfy the company’s $1.5 billion in outstanding debt.
Yellow did not respond to a request for comment.
More FreightWaves articles by Todd Maiden
- Schneider acquires another dedicated carrier
- Transportation prices fall notably again in July
- Yellow reported to be nearing deal for bankruptcy loan
Brokerage Compliance Symposium
The day before F3. Every compliance issue you face - fraud exposure, carrier liability, FMCSA rules, cargo theft, insurance gaps - navigated by attorneys and operators defining best practices in a changing industry.
F3 Awards Dinner
The night before F3. FreightTech100 companies honored. FreightTech 25 and Shipper of Choice winners revealed live. Cocktail reception into dinner and live music - 300 industry leaders in one purpose-built room.
F3: Future of Freight Festival
Industry-defining keynotes, rapid-fire technology demos, and industry leaders networking in experiences across Chattanooga - plus the inaugural F3 Awards Dinner featuring the FreightTech and Shipper of Choice reveals.
The day before F3. Every compliance issue you face - fraud exposure, carrier liability, FMCSA rules, cargo theft, insurance gaps - navigated by attorneys and operators defining best practices in a changing industry.
The Signal at Chattanooga Choo Choo • Chattanooga, TN Register NowThe night before F3. FreightTech100 companies honored. FreightTech 25 and Shipper of Choice winners revealed live. Cocktail reception into dinner and live music - 300 industry leaders in one purpose-built room.
The Signal at Chattanooga Choo Choo • Chattanooga, TN Register NowIndustry-defining keynotes, rapid-fire technology demos, and industry leaders networking in experiences across Chattanooga - plus the inaugural F3 Awards Dinner featuring the FreightTech and Shipper of Choice reveals.
The Signal at Chattanooga Choo Choo • Chattanooga, TN Register Now