Weber Aircraft plans next year to close its Burbank manufacturing plant, which employs 1,000 people, because its hourly workers have refused to accept pay cuts of up to 33%.
The workers' union and Weber still have time to reach an agreement that might save the plant, which is to be closed by the end of 1988. But no talks are scheduled and neither side is optimistic of a breakthrough.
Weber produces seats, galleys, lavatories and other equipment for commercial and military aircraft. Although profitable, the company says it needs the lower wages to remain competitive against several U.S. and foreign rivals.
At Weber's two other plants--in Brea and Gainesville, Tex.--hourly workers already make about one-third less than their counterparts in Burbank, who earn an average of $12.25 an hour.
Robert McCarty, Weber's vice president for human resources, said the Burbank wages must be lowered for Weber to keep pace with its competitors. Recent contracts up for bid to build lavatories for the Boeing 767 and 757 jetliners went to Japanese manufacturers, Jamco and Yokohama Rubber, respectively, because they have lower wage expenses, he said.
Weber is a subsidiary of Kidde Inc., a diversified concern headquartered in Saddle Brook, N.J., that last month agreed to be acquired for $1.8 billion by another conglomerate, Hanson Trust PLC of Britain.
Weber's effort to pare labor costs began before Hanson's agreement to buy Kidde. But the pressure for lower wages is unlikely to change when Hanson takes charge because the company is known for aggressively cutting costs at its newly acquired American properties to boost profits.
The union representing the 700 hourly workers in Burbank is District 727 of the International Assn. of Machinists & Aerospace Workers. On Sept. 4, the union met with Weber officials and told the company that it would not put the wage-cut request to a vote because a poll of half of the workers showed most opposed the idea.
That same day, Weber sent out a letter to its employees telling them the company planned to close the plant.
"These are reductions in pay that are just unconscionable, and the employees indicated they wanted no part of it," said union spokesman Neil Vandercook.
Weber will "begin implementing our plans for plant closure," McCarty said, by shifting long-term orders to the company's Brea and Gainesville plants.
McCarty said the company bought the Brea plant in 1986 and inherited the existing labor contract. And at the Texas plant, where the workers are represented by the Teamsters, McCarty said, Weber has had "competitive labor rates" since the plant opened in 1967.
The Burbank workers and Weber signed a three-year contract last November, and also agreed that either side could reopen negotiations over wages next month. But Weber pressed for the pay cuts two months ahead of schedule by giving the workers an ultimatum Aug. 21: Accept wage cuts of up to $4 an hour or the plant will close.
Neither side seems ready to blink. Asked if there was another way besides asking workers to take pay cuts in order to keep the plant open, McCarty replied: "I don't know what it would be at this point."
Vandercook was just as pessimistic. "They're going to close it, and close it regardless of any votes" by the workers, he said. "I believe they're intent on closing it and getting away to their lower-paying locales."
Some of Weber's workers complained that Weber's salaried personnel are not being asked to make comparable wage concessions.
Edward Breault, 33, a tool manager who has been with Weber 10 years, said the company is asking the workers to take the full fall. "The majority of us have accepted it (the plant closing). All of us are willing to work with the company if they'll just play fair," he said.
The proposed plant closure "breaks my heart," said Theodore Fried, 65, an assembly manager and 38-year veteran of Weber. But he added: "We have a contract that goes until 1989. The contract should be valid."
About 200 of the 700 union members in the Burbank plant are exempt from Weber's wage-cut proposal. They are either Weber's most skilled hourly workers, such as top-level machinists or inspectors, or those who already earn less than Weber proposed, McCarty said.
Also exempt are Weber's executives and some of its engineers, but a "significant" number of engineers and other salaried personnel also were asked to accept less pay, McCarty said.