Rumors have been swirling in the trucking industry for the past week that New Century Transportation Inc. was teetering on the brink of closing its doors. Late Monday, June 9, employees and drivers received word that the company was filing for Chapter 7 bankruptcy protection and shutting its doors.
Matt Huber, an outbound dispatcher for New Century, confirmed the closing for Land Line on Tuesday. He said the closure will affect approximately 600 long-haul drivers and about 400 local drivers, as well as terminal employees.
“Yes, we are closing our doors effective today,” Huber told Land Line. “The company sent out a letter that most employees received on Monday.”
Some drivers who have been on the road and have not been home to check their mail didn’t find out the news until early Tuesday. They found out from office employees who went home last night, checked their mail, and found the termination letters.
Employees received this letter from Terrence M. Gilbert, chief executive officer of New Century, late Monday.
“This is to notify you that, due to unforeseeable and dramatic change in business circumstances beyond its control, New Century Transportation Inc. expects that it will permanently shut down its operations and all of its facilities, including the facility located at 45 East Park Drive, Westhampton, New Jersey, and will terminate all employees.”
According to Gilbert’s letter, the shutdown arose “when NCT’s lender recently and unexpectedly declined to continue funding regular business operations.”
Huber said his last day in the home office in Westhampton, N.J., is today. He added that none of the executives in the office on Tuesday have verbally communicated with the employees about the shutdown.
“It’s been pretty chaotic here today; everybody is in scramble mode,” Huber said. “The sad part of this is that we hired some drivers, had them go through orientation and leave out on Friday with their first – and last – load for this company.”
Some drivers told Land Line they had a bad feeling something was wrong when their fuel cards didn’t work late last week, but again were working on Monday. Huber told Land Line that he heard that the company received a cash infusion to pay Comdata to get the fuel cards working to get the equipment home.”
“From what I have heard, it’s not the intention for the drivers to be stranded on the road,” Huber said. “I have heard that the drivers will be paid for every mile they run if they return their equipment back here to New Jersey. Again, that’s just what I have heard.”
Huber said the company has been offering transportation today to drivers who have already turned in their trucks and need rides to the bus station.
Unfortunately, Huber said this isn’t his first go-around with a shutdown of this magnitude. He worked for Jevic Transportation of Delanco, N.J., which abruptly ceased operations in May 2008, terminating approximately 1,200 employees and drivers. Some drivers were not paid and some were stranded on the road.
“Last week I had an eerie feeling that this was what was going to happen,” Huber said. “While we were getting reassurances that this wasn’t the case, things were so similar to when Jevic closed its doors.”
Huber said he has received several calls from customers demanding their freight back or who decided not to book loads with the company because of the rumors they were hearing about the company’s financial situation last week. He said Estes Freight will be assisting them with some of their loads during the shutdown process. Estes has stated they have some driver openings available, but is not buying New Century.
Land Line’s calls to Mark Olszewski, president of New Century Transportation, were not returned as of press time on Tuesday.
OOIDA member John Flester of Jessup, Md., had shoulder surgery yesterday morning. After returning home from his outpatient surgery, he opened the mail and read that he no longer had a job.
Flester, who has been driving since 1970, said this is the first shutdown he has experienced in his 44-year career.
Flester, who worked in the company’s long-haul division, said he had no inkling that the company was in financial trouble. In fact, he said the company had just purchased several 2013 International ProStar tractors, as well as several newer model Freightliner Cascadias.
On Tuesday morning, Larry Middleton, who runs team with his wife, Betty, said his fuel card was still working and they were trying to get all of their loads delivered. He said the company is no longer paying lumper fees. He told Land Line he unloaded eight pallets at his first drop in Florida because of the lumper fee issue, but said the next load of pallets was stacked sideways and he couldn’t unload them. He then called the company to find out what he should do.
“I was told to tell them that if they wanted their freight they were going to have to unload it themselves, then call the shipper and get the money,” Larry Middleton told Land Line.
“I owe it to my customers to get them their freight and I will honor my commitment, but I am worried about getting stuck in New Jersey after I return their truck,” he said. “While they say they are going to pay me for every mile I run, there is no guarantee at this point that we will get paid, then it’s up to us to pay our way home to Florida.”
New Century also has a brokerage, Northwind Logistics.
“I’m sure the drivers that work with Northwind, New Century’s in-house brokerage, were notified, but I don’t know how or when,” Huber said.
Dale Watkins of the Owner-Operator Independent Drivers Association told Land Line that if a motor carrier has taken a load from the brokerage side of New Century and hasn’t got paid according to their agreement, the carrier may contact the shipper to verify if the broker was paid.
“This gets a little squirmy because of the bankruptcy filing,” Watkins said. “A lot of times, even when the carrier is paid, the bankruptcy court will come back after the motor carrier for the money back.”
Watkins added that it’s important for drivers who are in the process of returning their equipment to document it, either by taking a photo at the home terminal, or have someone with the company sign a document, confirming that their equipment has been returned.
“This is important because you don’t want to be hit with an abandonment charge or a theft charge for not returning the company’s equipment when you go to look for a new job with a new carrier,” he said. “By documenting everything, you have proof that you did as you were instructed by the company to do.”
Some drivers who live as far away as Southern California have been instructed to return their equipment to New Century’s terminal in New Jersey.
Many drivers recall the Arrow Trucking shutdown in December 2009, which stranded truckers all across the county with no fuel and no money. Some were unable to return their trucks to the company’s headquarters. While Huber says he has been told that the drivers will be paid, some are unsure if they will have the financial means to get back home. It all depends on whether they receive their paychecks as promised.
Watkins said drivers that do not have the financial means to get back home should contact the company and explain the situation. He said it’s important to document any communication with the company in case there is a dispute down the road.
Although John Flester has already received a call from a trucking company interested in hiring him, he is bitter about the way he found out about the company’s closure.
“I believe in driver loyalty and I worked hard for them for seven years,” Flester told Land Line. “It really hurts when they don’t have that same loyalty to you and they turn around and stick their foot up your butt. It just isn’t fair.”
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