New contract at Herrin; it will be main plant for vertical-axis

New contract at Herrin; it will be main plant for vertical-axis
 
Date June 13, 2005
Section(s) Local News
Brief  
 
By DAVID PITT

Associated Press Writer

Workers at a Maytag Corp. washer and dryer manufacturing plant in southern Illinois ratified a new four-year contract on Saturday which will enable the plant to become the main facility for vertical-axis washer production.

The new contract included four annual pay increases and improvements in the company-offered pension plan, said Steve Jones, an International Association of Machinists and Aerospace Workers business representative.

Medical cost increases for workers in the new contract will be offset by the pay increases, he said.

“We’re ready to go back to work and do the jobs we need to do,” said Jones, who represents workers at Machinists’ Local 554 in Herrin, Ill.

The current contract was scheduled to expire at midnight Sunday.

The workers make washers and dryers at the Herrin, Ill., plant, which currently employs around 1,000 workers, Jones said. About 100 workers have been laid off in the past few years, he said.

Maytag officials praised the union for their willingness to work with the company on a new agreement.

“The cooperative attitude displayed at Herrin should allow Maytag to remain competitive in our challenging global marketplace and enable Herrin to become the main facility for our vertical-axis, top-load washer production,” said Mark Krivoruchka, Maytag‘s senior vice president of human resources, in a statement. “We want to thank I.A.M. Local 554 leadership and the Herrin union employees for their willingness to work together to reach this new labor agreement.”

Maytag has struggled to compete in recent years against low-cost imports. Herrin is a town of some 11,300 people, about 10 miles northeast of Carbondale, Ill.

Workers at other Maytag plants have made contract concessions in recent years.

The 1,340 workers at the company’s flagship factory in Newton, which makes vertical-axis Atlantis and Dependable Care washers and dryers, along with horizontal-axis Neptune washers, agreed to a new four-year contract last July after a strike of nearly three weeks.

Still, Maytag CEO Ralph Hake said the Newton plant could be phased out if significant cost savings aren’t found.

A Hoover vacuum cleaner plant in North Canton, Ohio, could also close if improvements in efficiency and cost are not made, Hake has said.

In an April conference call with analysts, Hake suggested that plants in Herrin and Searcy, Ark., were eligible to manufacture newly designed laundry equipment, while production at the higher cost plants likely would be phased out without additional cost savings.

Company officials indicated to the union that they would make the Herrin plant Maytag‘s primary manufacturer of top-load washing machines, Jones said.

“We think this helps leverage our position at Herrin,” he said.

Maytag‘s board of directors announced last month that it had agreed to sell Maytag to New York-based Ripplewood Holdings LLC and three other investment companies for $1.13 billion and assumption of $975 million in debt.

The deal is pending regulatory and shareholder approval.

Jones said he believes the new contract puts the plant in a good position regardless of who owns the company.

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