TEAMSTERS LAUNCH STEPPED-UP CAMPAIGNTO GET CONSOLIDATED FREIGHTWAYS 'ON THE RIGHT ROAD'
Teamster President Calls for Board Action to Rebuild Trust Among Employees, Customers & Shareholders SAN FRANCISCO, April 26 /PRNewswire/ -- The International Brotherhood of Teamsters issued the following: The Teamsters Union today took its Consolidated Freightways' shareholder campaign to the company's annual meeting, as the union's President Ron Carey called on company officials to take action to rebuild the company's tarnished image and performance. Citing recent short-sighted management decisions that have damaged CF's relations with employees, customers and investors, Carey called for a new committee to craft safeguards that would halt such practices. While shareholder value has been falling farther below the industry average, CF's resources and reputation have been draining off, as well, through costly litigation, financial penalties and settlement payments incurred through management mistakes. "After five years of disarray, it's time for the board to take direct action to rebuild the broken trust between CF management and its employees, customers and shareholders," said Carey. "As the employees and owners of this company, we are holding this board accountable. It's time to get CF on the right road." Proxy Battle Aims to Increase Shareholders' Influence Carey's appearance before CF's board and shareholders was the second act in a dramatic Teamster-led proxy fight that has united employee shareholders, who form the largest single shareholder bloc, with other major institutional investors to press for greater influence over the board. The first act ended in victory for the shareholders last week, when CF -- seeing that the shareholders were united -- instituted a new policy to respond to an employee shareholder demand for an increased voice in corporate governance. CF moved up the expiration date of its "poison pill" by a year and agreed that it would not instate any new poison pill in the future without shareholder approval. The poison pill is a management entrenchment device which allows the board to take steps that increase the debt load and depress shareholder value in order to make the company less attractive as a takeover target. At today's meeting, speaking on behalf of a resolution proposed by shareholder Robert Eddy, a 24-year CF employee, Carey urged the shareholders to move forward on reform by voting for the measure to declassify the board of directors. The current election system promotes management entrenchment and insulates the board from having to face the consequences of bad decisions by staggering board elections so that only one-third of the directors must stand for election each year. Eddy's resolution would make the board directly accountable for the company's actions by requiring a single annual election for all directors. Bad Management Decisions Cited Carey outlined for the shareholders some of the serious problems that have beset CF recently because of short-sighted management decisions, including: -- An ongoing investigation by the Justice Department and the U.S. Postal Inspection Service over Emery's $1.9 million overcharges of the Postal Service during Operation Desert Storm. -- Litigation by hundreds of former employees on charges of age discrimination, ERISA violations and fiduciary improprieties. One age discrimination suit recently ended in a $3 million settlement. Other high-cost, high-profile legal fights continue with CF's former CEO and the former head of Emery. -- Management policies that pit worker against worker and sap the company's resources and employee morale. Teamsters Plan Nationwide Campaign: "Get CF on the Right Road" While Carey addressed the shareholders, Teamsters who are employed by CF and officials from their local unions distributed campaign leaflets outside. The leaflets detail the company's poor stock performance, with values that have now dropped to less than one-third of the industry average, and list serious management mistakesparticipated in a Sund ay strategy session that brought together members and leaders of Teamster CF locals. CF employs some 19,000 Teamsters nationwide, who are members of over 70 locals. Taking as their theme, "Get CF on the Right Road," participants in Sunday's meeting and Monday's leafleting will be taking the campaign back to their home locals in a campaign designed to continue to build pressure on CF for reforms in governance and corporate policies. -0- 4/26/93 /CONTACT: Bernie Mulligan or Nancy Stella of the International Brotherhood of Teamsters, 202-624-6911/
CO: International Brotherhood of Teamsters; Consolidated Freightways ST: California IN: TRN SU:
KD-DC -- DC016 -- 0729 04/26/93 13:07 EDT
|Printer friendly Cite/link Email Feedback|
|Date:||Apr 26, 1993|
|Previous Article:||FANNIE MAE ANNOUNCES POSTED YIELDS|
|Next Article:||DETROIT EDISON PARTNERS WITH CUSTOMERS TO HELP MICHIGAN'S ECONOMY|