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7 August, 2006
Some 20 months after arguing that it didn’t have to adhere to a United Steelworkers (USW) plant-closing agreement in the US because not all tyre workers were being displaced, Continental Tyre last week said it was totally shuttering rubber operations in Mayfield, state of Kentucky.
USW and German-based Continental became locked in dispute in late 2004 when the company announced it would no longer manufacture auto and light truck tyres at the Kentucky plant. The closure, which took effect 1 January 2005, cost 730 USW members their jobs. But Continental said it was not obligated to negotiate severance pay or other benefits for the sacked workers because it was retaining 100 jobs in Mayfield’s moulding and warehousing departments.
On 2 August, the company announced those and 50 management jobs would be lost by January 2007.
“The only surprise is that the company is finally acknowledging its intent to close our plant,” said Terry Beane, USW Local 665 President.
Ron Hoover, USW Executive Vice President, said, “It was obvious to us long ago that Continental decided to abandon US production. Their business strategies and management teams never addressed the dynamics of this market and unlike other successful companies, they refused to develop a collaborative relationship with us.”
Continental bought the Mayfield plant in the 1980s from General Tire Corp. The operation once employed 2,400 rubber workers
Continental also eliminated 800 union jobs this summer by closing a US tyre plant in Charlotte, state of North Carolina. The company demanded US$32 million in costs savings from the USW at this location, including 35% across-the-board wage and benefit cuts for each worker.
Even before USW could put forward a compromise offer, Continental made its plant closing threat a reality by announcing total closure of the Charlotte plant. The USW has petitioned the US Contact Point for the Organisation of Economic Cooperation and Development (OECD) to conduct an investigation of Continental’s rash and anti-worker conduct in Charlotte.