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Thursday, December 18, 2008

No surprise here: the Republic Window Factory closure was about union-busting

Posted by Jill | 5:14 AM

The workers at Republic Window Factory may have won the severance and vacation pay due them by their scummy management and Bank of America, but we shouldn't be fooled by the Capra-esque finale for these workers. Because there's more to the story, as Meg White (presumably not the White Stripes' Meg White) writes at Buzzflash:

As BuzzFlash reported at the time, after finding out they'd be out of work in three days at the beginning of December, workers at Republic Windows & Doors Inc. staged a sit-in at the factory to secure the benefits the company said it couldn't pay. Politicians all over the state threatened to stop doing business with Bank of America and its subsidiaries until they paid out a loan to Republic so management could comply with its legal obligations to its former workers.
Negotiations have been ongoing, as has the sit-in, since the plant shut down. According to The New York Times, Republic CEO Rich Gillman demanded that any settlement with the bank also include money to pay for the leases on his BMW and Mercedes, as well as eight weeks worth of his salary. The final deal, announced last Wednesday, did not include such additions. Republic filed for bankruptcy that Friday.
Gillman was widely quoted to have blamed Republic's collapse on the broader economy and the credit freeze, calling the situation "a microcosm of what is happening to many large and small businesses" during the sit-in. But now it seems that Republic's story isn't all that representative.
There were signs that the company had been planning on leaving Chicago well before they broke the news to workers. During Gillman's brief tenure as CEO of Republic, the workforce was nearly halved by layoffs. The New York Times reported that union leaders noticed management had been making off with equipment weeks before the announcement.
Complaining about the high production costs in Chicago, Gillman had previously tried to purchase another plant in Ohio, but Bank of America turned him down for the loan. According to Republic's own statements, the company approached Bank of America back on October 16 about an "orderly wind down" culminating in its closing the factory in January.
The most obvious clue of Republic's intentions was carried out very quietly. Weeks before Republic's closing, Echo Windows & Doors LLC was incorporated in Illinois. Chitown Daily News reported that Echo was incorporated in Iowa about one week later. Neither list Rich Gillman as the head of the business, but the Iowa incorporation is under his wife's name. Echo then proceeded to buy a window and door manufacturing plant in Red Oak, IA, previously owned by a faltering company called Traco.
It seems that, despite fears of the Illinois Attorney General, Republic's customers aren't much affected by the shutdown of the Chicago factory. A glass trade publication article cites industry dealers as saying they've simply moved their orders from Republic to Echo. Another industry publication is reporting that the former vice president of sales at Republic is now the main contact for www.echowindows.com.
With such a sequence of events, it's natural to wonder whether Republic was run into the ground in order to set up elsewhere for cheaper. Leah Fried, an organizer with UE that is working with the former Republic workers, said it's impossible for her to say what the former owners of Republic have been planning, since the union has always had a tough time getting the truth from them.
"The management -- especially Rich Gillman -- have been very dishonest," Fried said in a telephone interview with BuzzFlash. Of Gillman, she said "he's never straight with us."
Local news reports quote city organizers and other Iowans as nervous about labor problems at the former Traco plant, now that the Gillmans are relocating to Red Oak. According to an article from Midlands News Service, the Iowa workers hired after the buyout of Traco had to sign confidentiality agreements and have already seen an increased workload since the takeover. The article goes on to say the workers are not unionized, and are paid $10 to $12 an hour.
Fried said she couldn't be sure if Iowa could count on Echo to be a positive factor in the manufacturing landscape in Red Oak.
"With Rich Gillman, anything is possible," she said wryly.
She also noted that, while there are UE members in Iowa, it is a "Right to Work" state, and Illinois is not. The Right to Work law makes organizing a union more difficult, often resulting in lower pay.

Unionized workers everywhere, as well as non-unionized workers who are making good wages because of their unionized counterparts, ought to pay close attention to this story. Because the story of Republic Window and Door represents in vivid color the race to the compensation bottom that American manufacturing workers face whether they are unionized or not. And if the workers at Toyota, Nissan, and Mercedes plants in the south think they'll continue to make money that's close to what their UAW compatriots make once the UAW is busted, they ought to guess again. Because no one is buying cars right now, and once the UAW isn't propping up their compensation, they are next in the management and Republican politician crosshairs.

Labels: corporatism, greed, union-busting

2 comments

2 Comments:

Dejah said...

Well GEE, how long did it take all y'all to figure that out? I read my first article on the mess and read that Republic had reformed under a new corp and bought a non-union factory and said "union busting."

I DO wish that people would stop calling those terrible laws "Right to Work." "Right to Work" really means "right to be fired" as anyone who lives in a "right to be fired" state (and has been fired) can tell you. At the very least, call it "at will." At the very least, "at will" describes how easy it is to be fired in a so called "Right to Work" state.

12/20/08, 11:58 AM

Unknown said...

I have been fighting this for over 20 years. The repugs have had an anti-union stanse for ever. My son was in the pipe fitters union b4 nine eleven.had a very good union,very good. then he was hanging arount the wrong group. ended up quiting the union and joined the Air Force @ 1/4 the pay.after 4 years in the airforce he now is a repug and a raceist. too bad.what the repugs ia for ALL American workers to be AT WILL EMPLOYES.

12/20/08, 12:31 PM