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Company plans negotiations with union

When Intermet Ironton Iron closes its doors in early 2000, it leaves 619 employees without the security of steady income – and some might not benefit from severance packages, either.

Wednesday, December 08, 1999

When Intermet Ironton Iron closes its doors in early 2000, it leaves 619 employees without the security of steady income – and some might not benefit from severance packages, either.

Union and company officials continue to negotiate severance benefits for hourly employees who are not eligible to receive the packages according to their current contract.

"The present labor agreement for the hourly workers does not currently provide for severance benefits, although we are discussing that fact with the union representatives," said Mike Kelly, corporate communications manager, adding that salaried employees’ benefits also are under discussion. "The exact terms of any severance benefits will need to be negotiated with the union."

Other negotiations concerning severance packages also are still in the works, and Kelly declined to comment on what types of packages will be offered to salaried employees.

"Again, that is something we are discussing with the union and is not really something we can speculate on or discuss at this time," Kelly said.

In fact, the only sure way at present to receive benefit plans from Intermet is to retire.

"Retirement plans, which are 401K, are not affected by this," Kelly said. "Those are still owned by the employees and will remain that way."

The company blames the closing, which will leave 619 families with a bitter Christmas, on shrinking business.

"The decision was made based on the fact that our customers have been moving their programs out of the foundry," Kelly said. "That, along with the fact that the plant has had consistent and long-term financial difficulties, caused us to make this decision."

The foundry is expected to lose most of its remaining business in early 2000 as customers move work to other suppliers, and, with the expected steep decline in business, company officials expected losses for the foreseeable future.

The federal WARN Act notification, which requires employers to provide a minimum of 60 days notice to employees, the union and the city, began today, but the clock is set to an undetermined amount of time before the foundry closes its doors permanently.

"The exact timing and the logistics of shutting the plant down has not been determined," Kelly said. "We are working with the union representatives on that."

Although Intermet has foundry locations in Georgia, Alabama, Virginia, Illinois, Minnesota and Europe, there are no current plans to relocate any Ironton foundry employees to those sites.

"We see very few if any opportunities for Ironton employees moving to our other plants," Kelly said. "(The union) has expressed an interest in seeking another buyer. We’d certainly take a look at that, but there are none at the present time. Again, that is something that we will be discussing with the union."

The closing comes as an unfortunate surprise to city and county officials, who, earlier Tuesday, still had heard nothing but rumors of an impending closure.

"It is certainly a sad day for Ironton," Ironton Mayor Bob Cleary said. "I think that at the corporate level they have looked at the losses and made the decision and there isn’t anything anyone can do or say that will change their minds. We are all broken-hearted for the employees and their families, and we will do everything we possibly can do to help them."

The city’s income tax revenue-based budget has taken hard hits this year with the Cabletron System Inc. closure, as well as with cutbacks at AlliedSignal and Ashland Inc.

The dwindling city budget will almost certainly mean cutbacks throughout the city, Cleary said.

"They met with me today and the employees will be terminated by Feb. 7," he said. "This is an estimated income tax loss of about $225,000, so we are definitely going to have to revisit the budget and look at ways that we can trim the budget and try to continue to provide everyone with the services they are used to receiving."