Local 1101 Members Rally for Jobs and Severence at Lakewood Engineering

June 5, 2008

Workers at Lakewood Engineering and Manufacturing rallied outside the plant on May 29. The demands of the UE Local 1101 members were for jobs, and for a decent package of severance benefits for workers who are about to lose their jobs.

Local 1101 members were joined for their rally by supporters from UE Local 1166, Jobs with Justice and from two Chicago organizations that fight for immigrant workers’ rights – the March 10 Movement and Casa Aztlan. They were addressed by UE Director of Organization Bob Kingsley and Western Region President Carl Rosen.

On April 25 the Lakewood company gave Local 1101 notice under the WARN Act of its intention to close, which will put 220 workers out of a job. Lakewood workers make electric fans and heaters. The company’s biggest customer is Wal-Mart, accounting for 80 to 90 percent of its heater sales. The announcement that Lakewood would close was caused by Wal-Mart’s decision to re-source its electric heaters to China.

Since May 8 the union has been in negotiations with the company, demanding a fair package of severance pay and health insurance benefits. But the company is refusing to offer any plant closing benefits, beyond the very minimal severance pay (four weeks for 15 years service) that’s already included in the labor contract.

About 95 percent of the Lakewood workforce consists of legal residents of Mexican origin, with an average of over 20 years seniority. Most are women. The closing of Lakewood would mean an immediate direct loss of $5 million in wages to the Latino community, and overall economic loss of up to $15 million.

Lakewood Engineering is heavily mortgaged to Wells Fargo Bank, and the company is claiming that its hands are tied by the bank's refusal to extend it more credit. With the help of Jobs with Justice and its Chicago Worker Rights Board, the union is demanding that Wells Fargo provide sufficient credit to Lakewood to finance a decent severance package for workers, and potentially to enable Lakewood to continue manufacturing fans for the 2009 season. Wells Fargo is also involved in the subprime mortgage scandal that has resulted in massive home foreclosures and the collapse of the housing market.

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