Republic Workers End Sit-In with Win
With additional loans of $1.35 million from Bank of America and $400,000 from JPMorgan Chase, Republic Windows & Doors has agreed to meet its obligations to its employees, ending a six-day sit-in by the company's union workers that attracted significant national attention.
The money will go toward 60-day severance wages, vacation pay and a two-month extension of health insurance due the workers under the WARN Act, which requires companies to provide 60 days' advance notice of closings or significant layoffs. Republic announced plans to shut down its operations only three days before last Friday's closing. According to local news reports, workers emerged from the Chicago factory last night victoriously chanting "Yes We Did," after voting to accept the agreement and end the sit-in.
Republic officials have still not commented publicly on the agreement, but the banks that were the primary target of worker protests each issued statements. "We have worked with the company's management and other owners, including Chase Capital Corp., to do the right thing for employees," said David Rudis, Illinois president for Bank of America.
"Compliance with the WARN Act is the responsibility of management and owners," he continued. "Although we are a lender with no obligation to pay Republic's employees or make additional loans to Republic, we agreed to extend an additional loan to be used exclusively to pay its employees."
In announcing its loan, Chase noted that it is earmarked specifically to help Republic employees. Beginning in early 2007, Chase Capital Corp.–a subsidiary of JPMorgan Chase–invested and lent $12 million to help Republic continue to operate, becoming a minority investor in Republic. Chase Capital anticipates no recovery on those loans and investments, the company notes.
Bank of America reports that Republic has lost $10 million over the past two years, during which time Bank of America lent it the "maximum amount of funding we can under the terms of our agreement." "While we regret the unfortunate circumstances that have befallen Republic Windows and Doors, which was exacerbated by the current economic climate and its industry, the facts are that Republic Windows and Doors is unable to operate profitably," Rudis said.
While the union workers wil receive severance and due vacation pay, the sit-in did not produce any agreement to re-open the Republic factory. Organizers for the United Electrical, Radio and Machine Workers of America, the workers' union, told local newspapers that a Windows of Opportunity Fund would be started with donations received during the sit-in to look at options for re-opening the plant.
Republic's owners have not commented further on plans for Echo Windows LLC, a new company which they formed separately to acquire the Traco residential window plant in Red Oak, Iowa.