Chicago factory worker protest, Chicago factory worker sit-in, Republic Windows & Doors
Eric Y. Exit/AP
Workers pass out food in the lobby of Republic Windows & Doors, in Chicago, Sunday, Dec.
7, 2008.

Chicago Factory Workers Reach Agreement, End Sit-in

December 11, 2008 11:28 AM
by Anne Szustek
Former employees of the shuttered Republic Windows & Doors factory ended their six-day standoff after a $1.75 million settlement to cover severance and vacation pay.

Laid-Off Factory Workers to Receive Benefits

Workers at the Republic Windows & Doors factory, union representatives and Bank of America, the factory’s creditor, reached an agreement Wednesday evening worth a total $1.75 million dollars. The money will go into an escrow account for the employees’ benefits.

The employees then ended their six-day sit-in Wednesday evening, shouting “Yes we can,” the campaign slogan of President-elect Barack Obama.

The Republic factory, located in the Goose Island neighborhood of Chicago, suddenly closed its doors Dec. 5, leaving 300 employees, including 240 union members, jobless.

“We lost the jobs but we got something,” Lalo Munoz, a 24-year employee at the plant, told the Associated Press after the settlement was reached.

To protest being laid off without fringe benefits to which the workers say they are entitled, as well as being notified only three days prior to the plant’s closing (rather than 60 days prior as required by law), the unionized members of Republic’s staff staged a sit-in.

The deal, funded by a $1.35 million credit line to Republic from Bank of America, plus an additional $400,000 from JPMorgan Chase, will provide some $7,000 per worker in severance pay, vacation time and two months’ of health insurance.

By Dec. 9, the fifth day of the standoff, the protesters had garnered national headlines and the support of major Chicago-area political figures such as Ill. Gov. Rod Blagojevich and Illinois Democratic members of Congress Sen. Dick Durbin and Rep. Luis Gutierrez, who helped negotiate the $7,000 severance package.

Blagojevich, who was arrested by federal agents Tuesday morning in connection with corruption allegations, vowed Monday that “We, the state of Illinois, will suspend doing any business with the Bank of America,” Republic’s creditor. Officials of Cook County, where Chicago is located, as well as city aldermen also suggested a halt to official business with the bank.

“Flanked by union leaders, more than a dozen aldermen demanded that City Hall divest itself of funds deposited by Bank of America—and stop approving zoning changes sought by the bank and its subsidiaries,” reported the Chicago Sun-Times.

Republic was $3 million in debt to Bank of America, a situation aggravated by sluggish sales in the home goods segment. According to a Monday statement issued by the door and window company, Republic tried to extend its closure process over several months—a plan that was apparently rejected by Bank of America.

The Republic statement said that on Oct. 16, the factory presented Bank of America with a proposal to see production cease in January 2009, which would have given the company ample time to fulfill worker notification obligations stipulated by the WARN Act, which requires 60 days’ employee notice before plant closings. Two days later, Bank of America apparently rejected the proposal, as well as an updated plan from Republic as well as a request to distribute vacation pay to employees.
City officials are also after Republic to get the factory to pay back $9.3 million in tax-increment financing, or TIF, to build its Chicago plant. In addition, Republic set up a limited liability corporation in Iowa, where human resource expenditures are generally lower, a move that, according to the Chicago Sun-Times, “incensed” Chicago 49th Ward Alderman Joe Moore.

Durbin came down on Bank of America, saying that “We are going to sit down with my friends in the Senate and talk about ways to reach out” to the bank, which is receiving funds from the $700 Troubled Assets Relief Program, also known as TARP or the “bailout bill.”

Representatives from the union, Republic and Bank of America met for three hours on Monday to hash out disagreements, a step that Gutierrez said alleviated tensions and had “a tone of reconciliation,” as quoted by the Chicago Sun-Times. The congressman is pushing for a federal investigation into the company’s lack of employee severance pay.

Bank of America had said in a release earlier this week that the factory “should do all it can to honor its obligations to its employees and minimize the impact of failure on those employees,” also saying that the financial group already lent “the maximum amount of funding we can under the terms of this agreement.”

Opinion & Analysis: Recession sentiment, responsibility

The Republic Windows & Doors factory worker strike conjured images of Depression-era labor organizing, writes Nelson Lichtenstein, a history instructor at the University of California-Santa Barbara, and Christopher Phelps, who teaches at Ohio State University at Mansfield for CNN. After Flint, Mich., autoworkers told President Franklin D. Roosevelt just after his re-election in 1936, “You voted New Deal at the polls and defeated the auto barons. … Now get a New Deal in the shop,” the president signed the Wagner Act into a law a couple of months later, which encouraged labor organization and collective bargaining.

“Will history repeat itself?” Lichtenstein and Phelps write. “The Chicago factory occupiers, overwhelmingly Latino, don’t have much clout, but they rightly sense that the national mood is with them.”

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