Published Thursday, March 6, 2003
cost 500 jobs
Herald Business Editor
Werner Co. announced Wednesday it is considering yanking all ladder and related product lines from its Greenville-area plant, a move that could result in the loss of up to 500 jobs locally.
The company and United Steelworkers union leaders began talking Wednesday about the possibility of moving the manufacturing and distributing operation to other Werner plants in the United States. Werner spokesmen described the talk as "decision bargaining."
The union represents more than 500 workers at the plant through Local 3713-0.
Werner has been investigating the move for some time because its largest customer now buys 25 percent of its ladders from Mexico, leaving Werner with 75 percent of that customer's business, said John M. Guyton, Werner's director of human resources. He wouldn't identify the customer.
"What made us consider this move more seriously and want to discuss it with the union covering the Greenville facility is the fact that our largest customer has now started buying ladders manufactured in China,'' Guyton said.
He wouldn't specifically say if the company would seek wage or benefit concessions from workers as a way of keeping the operation at the local plant.
"That's part of the decision bargaining process which you can appreciate I won't do in the newspaper,'' he said. He said the company wanted open discussions with the union to reach "a decision beneficial to the company and our employees.''
Talks are also being held with two smaller unions at the plant, International Association of Machinists and Aerospace Workers Local 2032 and Teamsters Local 261, which collectively cover 20 workers.
A move of the other production line at the plant, involving aluminum extrusions, is not being considered, company officials said.
Werner managers are known to have complained that health-care costs per worker at the Greenville plant are well above those at its other plants. The company joins a growing list of area businesses grumbling that their health costs have skyrocketed 20 percent to 30 percent annually in recent years.
"If we decided to move some manufacturing lines to other lower-cost facilities elsewhere in the United States, it would increase our employment at those facilities,'' Guyton said.
The company expects to make a final decision by the end of the month.
Guyton said the company may make overtures to the state to keep the operation in Pennsylvania. "We're going to look into what monies may be available, but we're not sure if they are,'' he said.
A loss of 500 jobs amounts to nearly half of all jobs at the local plant.
With company headquarters located next to the Sugar Grove Township plant, Werner employs 1,050 locally, including 240 who have been laid off in recent months. Werner is Mercer County's second-largest industrial employer, just slightly behind Wheatland Tube Co.
If the company moves production elsewhere, up to 450 hourly workers would be permanently laid off; 50 salaried jobs would go as well.
"We are considering this move to protect the jobs of more than 2,300 U.S. employees, including approximately 550 in the Greenville area,'' Guyton said. "We are currently in a sound financial condition, but if we waited a few years to consider this move, we believe that companies with lower manufacturing costs would erode our market share, placing us in a much weaker position.''
If the company should decide to move the ladder operations, a severance package would be worked out with the unions to cover affected workers, Guyton said.
"Even if we were to move some manufacturing from Greenville, our headquarters would remain here, as would approximately 275 headquarters and 275 manufacturing jobs, demonstrating that we are continuing our half-century commitment to the Mercer County area,'' Guyton said.
Werner would give a 60-day notice of its intent to move the operation as required under the federal plant closing law, if and when that decision is made, he added.
The company is a leading manufacturer and distributor of ladders, climbing equipment and ladder accessories. Its other plants are in Chicago; Aniston, Ala.; Carrolton, Ky.; and Merced, Calif.
Werner is owned by Investcorp, a group of 10,000 Persian Gulf investors. Guyton said there is no correlation between the company's ownership and ongoing events in the Middle East.
"Absolutely not,'' he said. "No matter who owned Werner Co., they would be considering making the move at this time to remain competitive and protect the 2,300 jobs.''