June 4, 2010 12:47:00 PM
Today marks the two-week point for workers on strike at Omnova Solutions Inc.''s Columbus plant.
The workers'' contract expired May 15; since then, the company and the United Steelworkers Local 748-L have failed to reach an agreement that satisfies both entities.
Meanwhile, the plant has completely implemented its strike contingency plan and is fully operational.
"The plant has converted to full operational status, and we are producing and delivering product," Sandi Noah, director of communications for Omnova, said Wednesday morning.
"We are willing to try to continue to try to get a deal, to construct a dialogue," she added, noting the company won''t change its overall stance on changes needed to support the Columbus plant under current economic conditions.
Omnova''s Columbus plant is the primary plant for commercial wall coverings. Customers for this are hospitality hotels, office and retail buildings and restaurants, all of which have decreased new construction and remodeling, Noah said. Demand for wall coverings has been down from 45-80 percent over the past five years.
Functional coated fabrics, a durable plastic upholstery, also are produced at the plant, for the marine and transportation industry. Demand for functional coated fabric has been down 80 percent over the past five years.
In response, Omnova has had to consider changes at all of its nine plants, four of which are unionized, to operate more efficiently.
Jay Lawrence, president of the local union, said the contractual rights being threatened do not impact the operation of the plant.
"We''re willing to go back to the table and discuss stuff like insurance premiums and stuff like that, but we''re not willing to give up our contractual rights," Lawrence said, citing seniority rights of job preference and shift preference. "We''re not willing to give up our rights that doesn''t affect them operating the plant."
The company also has proposed cutting jobs and subcontracting them out, consolidating jobs, grouping people together in such a way as to negate job bid rights and allowing supervisors to schedule shifts at their own discretion without regard to seniority, Lawrence said.
Job cuts have been in response to the market, not in regards to union contracts, said Noah. Both Noah and Lawrence declined to go into details of the proposed contract, which was rejected by a vote of 168-2.
Noah is "not optimistic that further meetings would lead to tangible, constructive progress."
The plant is being run by salaried workers and augmented by outside temporary workers, she said.
The temporary workers have received safety training and operational training and are part of the company''s strike contingency plan put in place prior to the strike.
The last strike, some 40 years ago, lasted three months. The contract between the union and Omnova has remained relatively unchanged since then.
During the strike period, workers are being paid by the union''s strike fund.
"We have a strike fund that helps assist the people with their bills while they are on strike," explained Lawrence. "It''s a welfare fund."
Omnova''s Columbus plant employs 259 people, 174 of which are hourly wage workers, and is one of the area''s top 12 employers.
According to the company''s website, Omnova employs about 2,300 people in America, Europe and Asia.
Locally, Omnova estimates it has a $23 million annual impact on the economy in taxes, wages, salaries and payments to local vendors.
insanity commented at 6/4/2010 4:43:00 PM:
if the plant is fully operational without the strikers, i'd say they are wasting their time at this point. why would you even negociate with them when you can operate without them
love2fish commented at 6/4/2010 6:48:00 PM:
I'm getting really tired of hearing about this. These people need to be on their knees thanking God they even have a job right now! I know there are alot of other people out there (myself included) who would be SO thankful to have a job and be able to pay their bills. Wonder if Omnova would be interested in hiring me??? Union workers: QUIT GRIPING and being so dang picky and WORK unless you want someone else to take your place!
td commented at 6/4/2010 6:50:00 PM:
I bet that once that union strike fund dries up and the workers no longer have any money coming in, they'll change their tune. By that time however the non-unionized people will have proven they can do the same job as good or better and for less cost than the union people.
buddyboy commented at 6/4/2010 7:05:00 PM:
Unions are ruining our economy. This is another example of wanting more than the company can pay for.....I say hire permanent replacement workers.
disappointed in support commented at 6/4/2010 11:52:00 PM:
I am really disappointed in the remarks here. Maybe if there were more unions then the "BIG" business would stop trying to shaft the working man. You do not know what these men have to put up with, until you have walked in their shoes. The plant is not operating as they say, Their spokes person only can says what the company wants them too. The stock being shipped was stocked up before strike. The material they have run is very questional about customer exceptancy. Have you heard of the fights going on inside, or the finger pointing and threats, some of their "shiped in help" has walked out. Yes, they need their jobs but how much "shaft" do you take before you say enough. What do you think of the China and Thailand material coming back here to be inspected and then stamped "MADE IN THE USA."
ethel commented at 6/5/2010 12:30:00 AM:
First of all, those of you bashing the union have heard a one-sided story! Ms. Noah offers in every article that the company is ready and willing to negotiate with the workers, but I am a member of the union and not one offer has been made since their "Final Offer" on May 15. Ms. Noah, who is in a corporate office up north, is saying exactly what the CEO tells her to say. She's also trying to make it seem as though the company is making all of these offers and the union is being hard to please. After working for thirty years at this company, I shouldn't have my salary reduced, my retirement frozen/number of service years frozen, and medical benefits reduced. These salary workers that are supposedly operating the plant are not accustomed to getting their hands dirty and working in a plant that gets around 100 degrees! They are accustomed to sitting in their cool air-conditioned offices. No one from the company has bothered to mention about the workers walking off the job, the police being called for a fight, a worker getting burned, finger pointing and cursing that occurs between workers, or damaging machinery due to lack of knowledge of the equiptment. If Omnova is interested in cutting costs, why not start with the six-figure plant manager that flies in every Monday, stays in a hotel all week, and eats on the company's expense. There may be someone around here that would want his job! What about the massive number of empty trailers surrounding the plant so no one can see what they're doing. What about the security that's at the plant 24/7? What about the food truck and the open drink machines for everyone to snack as they wish? What about the security that follows Tob Cos and Kathy Brown to Starkville each afternoon so they will be "safe"? This is where the company should start! By the way, the strikers are not getting paid at this time! So, our money hasn't run out, we haven't received any! Striker's fund doesn't start until AFTER 4 weeks. Again, comment on what you KNOW, not what you've heard! The media paints a beautiful picture on Omnova's part, but that is not the exact picture here!
rebelfan commented at 6/5/2010 12:38:00 AM:
You hit the nail on the head, Ethel! This is exactly what Tob wants to do! He wants to get rid of all the people that have been loyal to Omnova for years and hire someone that is desperate for a job. That way, no benefits are offered. Bet ole Tob wants his benefits to keep coming and his salary to not be docked! Maybe he should invest in a house in Columbus and quite spending the company's money on plane tickets!
disappointed in support commented at 6/5/2010 1:00:00 AM:
I fully agree with you Rebelfan and Ethel, we need more of these in support of comments. Maybe some editor letters too. More info out there the better. Have to show the entire picture.
rebelfan commented at 6/5/2010 2:14:00 AM:
insanity.....let me tell you something....the plant is not fully operational...Ms Noah needs to get back on the Ark. Also, love2fish get on the Ark with Ms Noah.
frank commented at 6/5/2010 2:31:00 PM:
It appears that Omnova only has 3 unionized plants now. What an ill timed strike this was.
td commented at 6/5/2010 4:47:00 PM:
OK all you pro-union voices. Here is a quote from the article and I want your response.
"Demand for functional coated fabric has been down 80 percent over the past five years. In response, Omnova has had to consider changes at all of its nine plants."
I admit I don't know a lot about the union. That is why I want someone to please explain in a rational and logical way how any company can continue operating for a profit the same way they've done business for many years when today's consumer (remember he's the guy with the real money - not the company) is buying 80% less than he did 5 years ago.
buddyboy commented at 6/5/2010 7:21:00 PM:
td you are correct. When supply is down, companies have to make changes in order to stay in business. It is not rocket science. If the employees do not want to make some sacrifices, they may end losing it all when Omnova has to close the plant in Columbus. If Omnova chooses to hire permanent replacement workers...they can leave the complaining workers unemployed and hire people that will be glad to have a job and prevent possible closure of the plant. That sounds like a win win.
rebelfan commented at 6/5/2010 7:38:00 PM:
Ok TD.....You should not believe everything that the company puts out! This company has a big problem with telling lots of LIES!
love2fish commented at 6/5/2010 8:22:00 PM:
All I'm saying is, that with times being as tough as they are, one would think people would be HAPPY to have job even if conditions weren't ideal. Let me tell you - as someone who doesn't qualify for unemployement and who just got laid off - the picture is pretty bleak for me and my family. I have been searching and searching for a job and all I get told is "no one is hiring". So then to see people that HAVE a job gripe and complain about conditions that aren't ideal really burns me up! I will gladly and happily take your job that you say is SO bad, cause trust me, the alternative is that my bills go unpaid and my family doesn't eat. I think I'd rather work even in bad condtions if it means that I can provide for my family.
td commented at 6/5/2010 8:35:00 PM:
Rebelfan ... you did not answer my question, which is why I have trouble understanding your side of the arguement.
The article says sales are down 80% over 5 years. I assume it's the truth. You say it's a lie. OK, back up your claim with the facts. I assume that Omnova showed charts to the reporter illustrating sales figures and the cost to produce goods that validate their claim.
Are sales down over the past five years -- yes or no?
Does a company with declining sales for a particular good or service they provide have a duty to readjust their business model to meet the new demands of the marketplace?
Why would anyone want to work for a company where the management lies to their employees and the public?
thom geiger commented at 6/5/2010 11:00:00 PM:
I had decided I wasn't going to register an account but I am interested in the truth of a story, so here is Omnova's own 10-K filing with the SEC (I'll be interested to see how long it stays up);
Results of Operations for the Three Months Ended February 28, 2010 Compared to the Three Months Ended February 28, 2009
The Company's net sales in the first quarter of 2010 were $183.9 million compared to $160.2 million in the first quarter of 2009. The Company's Performance Chemicals business segment revenue increased by 19.2% while the Decorative Products business segment revenue increased 8.4%. Contributing to the sales increase in 2010 were higher volumes of $18.7 million, favorable pricing of $3.1 million and favorable foreign exchange translation of $1.9 million.
Gross profit in the first quarter of 2010 was $40.0 million with a gross profit margin of 21.8% compared to gross profit of $31.7 million and a gross profit margin of 19.8% in the first quarter of 2009. The improvement in gross profit was primarily due to the higher volumes.
Selling, general and administrative expense in the first quarter of 2010 increased $1.0 million, to $24.0 million, or 13.1% of sales, compared to $23.0 million, or 14.4% of net sales in the first quarter of 2009. The increase was primarily due to higher marketing expenses and higher incentive compensation expense.
Interest expense decreased $0.4 million, to $1.8 million, for the first quarter of 2010 compared to $2.2 million for the same period a year ago, due to lower average debt. The effective interest rate on the Company's debt was 4.5% during the first quarter of 2010, compared to 4.4% in the first quarter of 2009. Total debt at February 28, 2010 was $143.7 million, down $0.4 million from November 30, 2009 and down $30.4 million from February 28, 2009.
rebelfan commented at 6/5/2010 11:38:00 PM:
Ok, TD, read Mr. Geiger's comment about all the profit of Omnova! Does this sound like a company that is losing money or in hard financial times? That's what I'm trying to tell you and the rest of these people in Columbus that THINK they know the facts. Omnova shares information they want the public to know, but holds back "certain" information. We know that Omnova is continuing to make a profit and that's why we are not accepting the contract provided on May 15. Again, if EVERYONE, would take pays cuts as proposed to us, we might be more willing to compromise. However, Mr. Cos and many of the upper management workers are making huge sums of money each year. None of those salaries have been cut- so why should ours be cut?? Ask some of the salary employees just how many bonuses they've received in the last year. Well, let me tell you! They get one every quarter and this is given based on what the UNION employees run in the plant. How many bonuses did the Union employees receive for what they ran in the plant? Let me tell you-ZERO! Maybe the company could start by cutting out these bonuses that they don't even deserve!
ethel commented at 6/5/2010 11:41:00 PM:
Thanks Mr. Geiger for your hard work and research! This is the kind of information that the public needs to be informed about! Most of the community believes that the union workers are being hard to deal with, but the figures plainly show that Omnova is clearly making a profit! Thanks for getting this information out!
hope commented at 6/6/2010 9:29:00 AM:
In OMN's last conference call, they announced that they would not have to pay any federal tax in the U.S. for the year 2010, but would in China. Before they move to China, should the U.S. backcharge them for closing the plant?
td commented at 6/6/2010 9:51:00 AM:
After reading Thom's comments, I am convinced that Omnova is trying to mislead the public about sales being off 80%. He provided something that is very authorative and very convincing.
I would like for someone at the Dispatch to confront Omnova about the comments they made about their sales being off and their SEC filings. Maybe it was a great first quarter versus five bad years. I don't know. But the way I read the report the company is making a nice profit -- and that is the common goal of any business.
I just wish that those people who supported the union position had made such a compelling arguement earlier rather than just rant. You can only win a debate with facts.
With my question and Thom's answer -- you now have the facts.
hope commented at 6/6/2010 10:56:00 AM:
Honda workers in China make $230 a month (not a week) and for Apple computer $181 a month. Union or non-union workers can't competeagainst that pay. And yet, people will stand in line to buy Apple's products that are made by a communist country. Either the people in the U.S. are misinformed, or they are like the Republicans; they don't give a "hoot" how much the workers get paid as long as their bosses take home the bulk of the money.
disappointed in support commented at 6/6/2010 11:14:00 AM:
No one has mentioned that Omnova just purchased a part of Dow Chemical that deals with the materials that this plant uses. This was finalized on May 14. Check out Omnova own website for the facts.
charliebrown commented at 6/6/2010 11:36:00 AM:
Tom, I'm a little disappointed in your analysis. Does the SEC filings tell you if the Columbus plant was profitable? If you owned 10 stores and 9 of them made money but 1 lost money would you keep that one store open? If you where the sole owner out of the goodness of your heart you could keep that store open and lose money just so those employees could keep their jobs. If you had a board of directors and stockholders and bankers looking at your business they would tell you to close that one store. The easiest thing for OMNOVA would be to close the Columbus plant. I think they believe that the market for the Columbus plant products will eventually return and that is why the plant is still open. Sure the corporation is making money but is the Columbus plant?
disappointed in support commented at 6/6/2010 4:53:00 PM:
Charlie brown, you work for Tob?
rebelfan commented at 6/6/2010 7:03:00 PM:
charliebrown.........the columbus plant has always been the biggest money maker!! Columbus plant has always pulled the other plants out of the hole. Don't you believe everything you read!!
charliebrown commented at 6/6/2010 7:38:00 PM:
Thom, I am not your personal enemy, I don't even know you. I apologise for assuming you posted that article to boost the argument from others that said the Columbus plant was making money. rebelfan, that was true in the 90's but has not been true for a while.
disappointed in support commented at 6/6/2010 8:23:00 PM:
charlie brown back up your statement with facts like Thom did.
yeeeha commented at 6/6/2010 11:42:00 PM:
I am torn somewhat on this situation. Giving Kevin McMullen makes $3M (yes - Million)... (and cant even afford socks without holes in them [I swear])
I think everyone deserves a slice of the pie!
BUT- Look at it like this- Everyone needs a job. If what I hear is the truth, Columbus just spins the wheels for Omnova and doesnt make any cash for the company. Why does the union think they have a hold on this? Salary is running the non-profitable plant, so it looks like the writing is on the wall. I figure Kev will shut it down to non appreciative Ms folks and send it over seas.
rebelfan commented at 6/7/2010 12:22:00 AM:
Charlie Brown..... You must be a salary employee working for Tob! :(
disappointed in support commented at 6/7/2010 8:53:00 AM:
This plant is the begining of most of the new products. They develop and design these new products, fine tune the process and get it ready to run at the other plants. People seem to think this is about pay raises but it is not. This is mainly about seniorty, choice of shift, and freezing retirement, and shift hours to be worked. Insurance is not and issue either. These days a union is the only way to have any kind of security on your job. This plant is the money maker for Omnova. Their cost is up because of the development time of new products. If it was loosing money, why would Omnova keep pouring cash into the theater. the schools and the area, when they don't have too. Answer that one. This is public knowledge in the area. They also just purchased part of Dow Chemical May 14, this makes part of the materials used here. Sound like they are hurting bad enough to close the plant? This is just a union buster plan for them. Anyone that has been shafted by a large corporation knows how it feels.
charliebrown commented at 6/7/2010 10:22:00 PM:
Looking at the information Thom referenced:
1st quarter net profit Performance Chemicals - 13.8 million
1st quarter net loss Decorative Products - (.1 million)
Have to say I am excited about the businesses recently mentioned coming to town.
warren commented at 6/9/2010 11:04:00 PM:
Well, for one thing, the Union did NOT have a vote, not one, the employees cast every vote!!! So whose fault is it they are not working? Go figure.
It sounds to me like Omnova is doing most everything well. Making a profit is what Companies do! Remember, that's why they can provide people with jobs. And in this case, GOOD JOBS! Go figure.
And it sounds like they are only asking for the ability to run their business in a manner that will continue profitability. And that is still their right and responsibility, NOT the Unions. Go figure.
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