UE Local 258
members returned to their jobs at Cone Blanchard last month, after saving their plant from
a permanent shutdown. All had been laid off, without notice, on Feb. 21. Return to work
became possible once the Park Corp. bought the business at a bankruptcy court hearing on
June 24 -- but only after some tense days for the members and local officers.
Over the last few years the company got itself into trouble due to difficulties in
financing the work, not due to the lack of orders for the Cone Blanchard line of machine
tools. The former management tried numerous and varied schemes to re-finance the company,
including an employee buyout. In the end, management attempted to have employees put up
their own money to back a loan!
Meanwhile, payments on the insurance premiums were neglected; for a while, paycheck
deductions went unpaid. In January and February the company missed three paychecks. By
February the company was deeply in debt. Jerry Harrington, the chief executive officer,
was actively trying to find a buyer.
'TAKE-IT-OR-LEAVE-IT" OFFER
From the workers' perspective, the problem was not only finding a buyer but one who
would keep the work here - and recognize the union and accept union-made wage and benefit
levels and working conditions.
A shareholders' meeting accepted an offer by the Park Corp. on the condition that it
negotiate a new contract with the union. After two weeks of negotiations Park proposed a
substandard contract borrowed from another union and told the UE Local 258 committee to
take it or leave it.
This was a difficult moment for the union committee. They and their co-workers were out
of work and it seemed as though the Park Corp. was the only company willing to buy the
plant and get it running again. At that point the Goldman Group - already owners of two UE
shops in Springfield, Bryant Grinder and Fellows Gear Shaper - told the union it was
seriously interested in the purchasing Cone and would try to negotiate a better agreement.
The existence of another potential buyer gave union members under the leadership of Local
Pres. Doug Whitcomb the confidence they needed to reject Park's contract offer at a
dramatic Sunday morning membership meeting.
STUMBLING BLOCKS
Soon after, Park announced it was walking away from the Cone Blanchard deal. Newspapers
blamed the union for the loss of a potential savior. The bank holding the largest share of
Cone's debt announced it would hold a foreclosure sale on May 12. Such a sale carried with
it the danger that liquidators would dismember the plant, making any return to production
impossible.
At this point the union sought legal advice. Local 258 decided that since workers were
also creditors, they could force the company into voluntary bankruptcy. By placing Cone
into Chapter 11, union members blocked the foreclosure sale - and brought the Park Corp.
back to the bargaining table.
In a matter of days the two parties hammered an agreement approved by Local 258 members
in a 72-5 vote on May 18.
The next hurdle to overcome was the bankruptcy hearing. The union had confidence that
the judge would not allow the company to be liquidated, but there were no guarantees. The
Goldman Group was still interested in owning Cone; the union worried that Goldman would
consolidate the work in a Springfield plant, resulting in loss of work for Local 258
members, and that Goldman didn't have the money to adequately finance the deal.
PACKED HEARING ROOM
The hearing room in Rutland on June 24 was packed with Cone Blanchard workers and
retirees. First ruling against Goldman's objections to the sale, the judge then determined
that everyone's interests would be best served by returning the business to operation. An
operating business is more likely to pay its debts than a liquidated one, the judge
decided. Finding that Park had the resources that Goldman lacked, the judge approved the
Park Corporation's offer. Park became the latest owner of Cone Blanchard.
The union persevered and the members remained united through a very complex, confusing
and trying period. By the middle of July, UE Local 258 members began their return to work.
The Local 258 Committee was led by Pres. and District Two Sec.-Treas. Doug Whitcomb and
assisted by Field Org. Rachel Clough and District Pres. Judy Atkins.
UE News - 08/97
