|Tennessee Community Challenges
Bo McCurry had spread concrete on construction sites for 15 years when he went searching for a three-month job to get him through the winter. He got hired at Thomas Lighting's fixture manufacturing plant in Sparta, Tenn. That was in 1988.
McCurry never left. There, he met his future wife, Donna, joined Sparta Local 2143 and a family of union workers and managers that has been celebrated for its progressive relationship and productivity, contributing to the factory's designation as one of the top 10 manufacturing plants in North America in 2009 by Industry Week magazine.
On Nov. 11, the McCurrys—who share 50 years of seniority at the plant—were blindsided when representatives of the plant's owner, Netherlands-based Philips Luminaires, showed up at the factory to announce that it would be shut down. Most of the work performed by 130 bargaining unit members and 170 others will be transferred to a new plant under construction in Mexico.
Just two months ago, Sparta's work force was awarded the "Lean Manufacturing Cup," for efficiency, by Philips. Soon they will begin making fixtures that will use energy-efficient LED bulbs. The line will move to Mexico after it becomes productive.
"It was the way they pulled the plug on us," says McCurry, 56, president of Local 2143, recalling several successful rounds of negotiations over the years to keep the doors open on a plant that has not seen a union-led work stoppage in 30 years. Distribution costs have been cut by 60 percent and defective parts by 95 percent over the past four years.
This time, Philips' big shots showed up, accompanied by security men with earphones and delivered the death warrant for one of only two manufacturing plants left in a county whose unemployment already nears 15 percent. Then, they quickly escaped out the back door.
The Philips announcement was immediately met with an unprecedented demonstration of unity and resistance in Sparta. Local 2143 Business Manager Jerry Pryor—supported by servicing staff, Tenth District International Representative Brent Hall—joined with business, community and political leaders in Sparta to keep the plant from making the alarming list of 50,000 U.S. manufacturing plants that have shut down over the last decade.
A Rescue Attempt
A purchase proposal for the plant was prepared by state and county agencies, banks and the Sparta-White County Chamber of Commerce, supported by plant manager Dave Uhrik. Despite documenting the advantages to Philips of continuing a supply of products from Sparta, the company turned down the offer.
The regional industrial board is now considering appropriating $20,000 in travel and other expenses for community leaders to continue their advocacy with congressional leaders and Philips executives. Sparta officials estimate that the closure would negatively impact 2,500 total jobs, including the supply base and affected community services.
On Jan. 8, International President Edwin D. Hill joined Local 2143 members, political and business leaders at a rally to send the message far and wide: "Keep the lights on in Sparta!"
A Loyal Work Force
"Our goal is to stop this shutdown," says IBEW Manufacturing Department Director Randy Middleton. "Here's a foreign-based company that has already received more than $7 million in U.S. federal stimulus grants and contracts literally throwing away loyal workers and managers who have bent over backward to do the right things in Sparta."
Philips has announced that some of the production currently performed in Sparta will be sent to Philips' Day-Brite plant in Tupelo, Miss., which employs more than 300 members of Local 1028. By challenging the Sparta shutdown, says Middleton, the IBEW is also standing up to prevent Tupelo from being the next runaway shop.
In an editorial published in the Netherlands newspaper Eindhovens Dagblad, President Hill points to the progress that has flowed from labor-management participation in Sparta, where workers' compensation claims for injuries on the job have decreased as both sides have committed to building a safer, healthier workplace.
Plant Manager Uhrik and IBEW Business Manager Pryor were recognized in a January 2010 Industry Week story for their joint efforts to establish a health risk assessment and screening plan, employing an on-site nurse practitioner for early detection of serious employee medical problems. Pryor says his life was saved by an early cancer screening.
Newly-elected Sparta Mayor Jeff Young—whose mother was one of Thomas Lighting's first workers when the plant opened in 1963 and spent 46 years on the assembly line—has been working with state and county officials to figure out ways to help workers who could lose their jobs. Young toured the plant and learned the production costs for fixtures.
A Fine Product Line
"I've been in business myself for 28 years," says Young. "I can't for the life of me figure out how—with those low production costs—it makes any sense to spend millions of dollars to move this plant to Mexico."
Weighing an average of 12 pounds each, the Sparta plant's fixtures can be shipped to a majority of customers within one day. Labor costs are only 4 percent of total plant costs. Plant sources say the move to Mexico will cost an estimated $35 million. One piece of equipment alone will require six semi-trucks and months to transport.
Three years ago, White County's industrial board issued Philips a $5 million loan and local union leadership negotiated a new pay scale revising incentives on work that is now automated to help the company finance the installation of a new steel stamping press.
International Representative Hall, a former president and current board member of the Tennessee Labor-Management Foundation, remembers a roundtable discussion that preceded Industry Week's top-ten listing of the Sparta plant. "They were mesmerized," says Hall, who personally promoted the plant's products.
Hall and local union leaders contacted Tennessee Commissioner of Labor James Neeley when they heard that Volkswagen, which was building a new plant in Chattanooga, planned to order lighting for the facility from out-of-state sources. As a result of the union's lobbying, Volkswagen, which received significant tax breaks and other incentives from the state, agreed to purchase fixtures from the Sparta plant.
"I work with a lot of good people who clock in on time every day and do a good job," says Dwayne Pendergraph, who works on the automated strip line. "When the boss comes down and needs something done, we do it."
'Something's Got to Give'
This is Pendergraph's second bout with outsourcing to Mexico. He, his wife and in-laws, members of Sheet Metal Workers Local 483, worked at Carrier's industrial heating and cooling products plant in Morrison, Tenn., which shut down in 2005.
"My whole family has already taken a hard lick," says Pendergraph. "A lot of people here at Philips will be going through what we did. It's frustrating. We're doing our damndest, but the carpet keeps getting pulled out from under us."
"Something has got to give somewhere or, before too long," McCurry says, "our senators and congressmen will have to move their offices to Mexico or China."