ABF's latest labor agreement entails a gradual $6.50 per hour wage hike implemented by 2027
ABF Freight System has disclosed the details of its recently reached tentative agreement with its unionized workforce. The proposed five-year labor deal, set to take effect after the expiration of the current agreement on June 30, offers various benefits to employees, including wage increases, improved health and welfare contributions, additional sick days, an extra paid holiday, and a revised profit-sharing program. The agreement has received unanimous approval from union leaders and will now be voted on by ABF's Teamster employees over the next two weeks. ABF's objective in the negotiation process was to establish a fair agreement that aligns with market-based wages and benefits while facilitating the company's growth and necessary investments.
Key provisions of the agreement include a total hourly wage increase of $6.50 over the five-year term, along with a $4.46 per hour increase in benefits contributions during the same period. Hourly wages for regular employees will see an initial increase of $3.50 (plus 8.75 cents per mile) starting from July 1, followed by a 75-cent increase (plus 1.875 cents per mile) in each subsequent year. The profit-sharing program has been modified to include different tiers based on the company's operating ratio, ranging from a 1% payout for an operating ratio of 93% or better to a top-tier payout of 4% for an 87% or better operating ratio. Additionally, the agreement introduces new provisions related to paid holidays, sick days, and the creation of a non-CDL box truck position within the union.
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