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Xerox Plans to Shut Its El Segundo Plant : Employment: About 400 union assembly jobs will be eliminated. The company was unable to get the employees to agree to a 20% pay cut.


Xerox Corp. plans to close an El Segundo manufacturing plant after workers refused an offer to keep the facility open by taking a 20% cut in pay.

Union members voted 233 to 144 last week not to accept the pay package, which also included a freeze on wages for seven years and the elimination of perks, such as five minutes at the end of the day to wash up.

The Utah Avenue facility, where circuit boards and chips are assembled for printers and copiers, is expected to shut down within a year. About 400 union assembly jobs would be eliminated, and the jobs of an additional 300 non-union employees will be threatened. "The employees at the factory have spoken," company spokesman Jeff Simek said from Xerox offices in Rochester, N.Y. "The intention is to now move ahead" with the closure.

Union officials sent Xerox a letter on Monday, asking executives to go back to the bargaining table.

"I tried everything I can, but to tell you the truth, I think the chances now are slim," said Frank Nicholas, western regional manager and vice president of the Amalgamated Clothing and Textile Workers Union, which represents the assembly workers.

Earlier this year, company officials informed the union of its plans to shut down the facility.

Workers pressed the company to reverse the decision. Xerox's proposal: Come up with a way to cut costs. Company officials and union leaders reached a tentative agreement last month.

Although the proposal allowed employees to get bonuses if the factory met productivity goals, the cuts in their $7- to $18-per-hour salaries were too Draconian to accept, Nicholas said.

"This was a hard agreement to start with," Nicholas said. "We asked people to basically take a 20% cut in pay. . . .That's hard for people to swallow when the company, overall, is doing very well."

The closure is part of an overall reduction in Xerox's work force that started in late 1993. Xerox has trimmed 9,000 employees, and now employs about 87,000. After the plant closes, about 1,800 workers will remain at other El Segundo sites, Simek said.

"Nobody on the management side likes the fact that this has to happen, but the company was forced to remain competitive in a market that has very fierce global pressures," Simek said.

The manufacturing at the plant might be transferred elsewhere, or contracted to another company, Simek said.

When the plant opened 20 years ago, Xerox was the only player in the industry, Simek noted. "Now you can use your fingers and toes and then some to count competitors," he said.

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