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Poplar Bluff plant to lay off 500 workers
POPLAR BLUFF, Mo. -- About 500 area families are reeling from the announcement Thursday that Butler County's seventh largest employer will close in 2014, moving all jobs to plants in Mexico and Tennessee.
NORDYNE gathered employees Thursday afternoon to announce it will gradually relocate its split system and furnace manufacturing lines to Saltillo, Mexico. Its parent company, Nortek, will break ground there in a few weeks on a 550,000-square-foot $40 million facility.
About 200 employees at a Boonville, Mo., plant also will lose their jobs, but the Dyersburg, Tenn., plant will remain in operation, according to a news release from the company.
Information provided to employees said production lines are scheduled to move in the beginning of 2014, with the Poplar Bluff plant closing by the end of 2014.
A transition package promised each person will receive at least 60 days notice of their personal release date, as well as a minimum 10 weeks of severance compensation for every full-time employee. All severance pay is contingent on employees remaining with the manufacturer until they are laid off.
Poplar Bluff Industries, an economic development organization, and Poplar Bluff city government will work with NORDYNE to market its building to other manufacturers. Greater Poplar Bluff Area Chamber of Commerce president Steve Halter on Friday said Poplar Bluff has many positive attributes to attract employers, Halter said, including more quality workers available to other businesses and for the expansion of current employers.
"NORDYNE has been a great community partner for 12 years now," Halter said. "I spoke with Greg Simpson, vice president of operations, yesterday afternoon and he repeatedly stated that our local plant management team and employees were excellent and our community has always been good to their corporation."
Simpson said the company deems this step necessary to remain competitive, according to Halter.
NORDYNE said its industry has shrunk by more than 30 percent from previous highs. The company estimates 25 percent of all residential units are manufactured outside the U.S. and that number will continue to grow as the industry operates under heavy regulations.
Attempts to reduce costs and overhead have not been enough to keep pace with competitors, many of whom have moved substantial portions of production to "globally competitive locations," Dave LaGrand, president and chief executive officer, wrote in a letter to employees Friday.
"After the completion of an extensive analysis, NORDYNE has reached the decision to reduce its manufacturing and distribution footprint in the U.S.," reads another document given to employees Thursday. "The decision is the result of competitive pressures and a shrinking HVAC industry."
It is no reflection on the workforce at either location that will close, according to LaGrand.
"Both Poplar Bluff and Boonville have distinguished themselves with high levels of performance, for more than 12 years in Poplar Bluff and 34 years in Boonville," LaGrand said in the letter. "Unfortunately, in order to continue as a viable business it is necessary for us to drastically rethink our manufacturing strategy and make this move to outside of the U.S."
The long-term viability and competitiveness of NORDYNE will be greatly enhanced by this strategic business move, according to the company, which noted it is committed to minimizing the impact on its employees.
The transition package for full-time employees also will include an additional one week of severance pay for each year served, to a maximum 26 weeks. Unused vacation days from the year they are laid off will be paid with the severance payment, which will be available 10 days after the employee's release date.
The company said it will continue health insurance coverage for the month the employee is laid off and one month after. Extended coverage will be available for up to six months based on the number of years an employee has worked for the company.
All employee 401K funds will be rolled over to another qualified plan.
The company has arranged for representatives to visit the plant to help staff apply for other employment and unemployment benefits.
Poplar Bluff, Mo.