June 2011

Philips' Playbook for U.S. Plants:
First Acquire, Then Close
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The doors were shuttered at the Stonco Lighting factory in Union, N.J., May 6 as the plant's parent corporation, Netherlands-based Philips Electronics, moved ahead with plans to outsource the work to its operations in Mexico, eliminating more than 60 manufacturing jobs.

"Philips wasn't interested in doing anything to help keep the work here," says New York Local 3 Business Representative Anthony Esponda, who represented workers at Stonco.

"It was clear that they weren't going to negotiate with us on keeping the plant open."

Stonco was part of the Genlyte Group lighting chain, which was purchased by Philips in 2007. Genlyte and its predecessor, Thomas, were leading American producers of lighting fixtures for decades.

The Economist reported at the time of the sale that Philips' goal was to "use Genlyte's relations with distributors and retailers to increase sales of LED lighting in America."

But while boosting sales in the United States, the company has been downsizing its American work force by taking advantage of existing free trade agreements to shift production to foreign Philips' facilities, shutting down or dramatically downsizing four formerly American-owned plants in less than three years.

Last December, Stonco's Union, N.J., neighbor, Lightolier, was shuttered, with the majority of work moving to Mexico.

More than 70 lighting glass employees lost their jobs when Philips shut down its Danville, Ky., plant — purchased from Corning Glass in the mid '80s — because of competition from Philips foreign plants.

In 2009, Philips shut down the former Westinghouse lighting plant in Fairmont, W.Va., moving most of the production to the Netherlands. Nearly 90 workers lost their jobs.

More than 70 jobs at Philips Oral Healthcare's Snoqualmie, Wash., facility — makers of the Sonicare electronic toothbrush — were outsourced to China in 2009. Philips took over the plant in 2000 as part of its acquisition of the Washington-based Optiva Corp.

More than 270 workers at the Philips Lighting plant in Sparta, Tenn., are now fighting to keep their workplace open. The company announced it was moving the award-winning lighting fixture facility to Mexico by 2012.

"Philips' behavior is a perfect example of what's wrong with our current trading system," says International President Edwin D. Hill. "Philips uses our free trade agreements to get easy access to American markets, while outsourcing good jobs in their quest for the lowest wages possible, devastating communities — and all without consulting with their own employees or the affected communities."

Go to www.tellphilips.com for more on the campaign to keep the Sparta plant open.

Philips' New Jersey plant is the fifth facility in the U.S. to be shut down since 2008.

Photo used under a Creative Commons license from Flickr user David McK Flit.