Published May 3, 2002 in the Midland (MI) Daily News

By Beth Medley Bellor

The Dow Chemical Co.’s Michigan Operations is becoming more competitive.

That’s the good news. But for 40 pipefitters who couldn’t make their costs meet the company’s target, it makes the future very cloudy.

They were told Tuesday their trade will be outsourced within the next month. According to Dow, the company is working with United Steelworkers Local 12075 to “minimize the impact” to the workers.

Vice President and Site Leader Gary Veurink said, “Our objective continues to be to take steps to become globally competitive. As a part of that, we are faced with tough personnel decisions.

“It’s difficult to make a decision which results in outsourcing the work of Dow employees,” he continued. “Unfortunately, as a site, we are facing significant performance challenges and must become globally competitive to attract new business investment.”

The contract with the union requires an internal “pool” of 35 positions for people to slide into before anyone can be laid off. Holly LaRose-Roenicke, Michigan Operations spokeswoman, did not know whether the pipefitters would fall into such a safety net.

Neither do the workers. Scott Gorman, a pipefitter with 26 years at Dow, said he had “no clue” whether he will have a job in a pool. “I think we’re still hashing it out, trying to save our jobs.”

Union leaders were not available this morning.

The workers came up with ideas to help the company, save money and be more cost-competitive, Gorman said. “They turned around and rejected our offers.”

He said, and the company confirmed, the pipefitters were unable to make up a $1.1 million gap between themselves and outside bids.

In July 2001, Michigan Operations announced cuts of up to 400 jobs in two phases. The first phase of 260 cuts passed with no layoffs, between voluntary retirements and the protective pool provided by contract. Now is the second stage – up to 140 jobs cut over 12 to 18 months as site support functions undergo cost and quality comparisons with outside organizations providing the same services.

Two other trades are safe, as five refrigeration trade and elevator trade employees and three scale shop employees have shown they are cost-competitive.

On Monday, seven garage service employees began implementing their proposals to reduce costs and demonstrate they can be cost-competitive. A decision on whether they closed the gap between themselves and outside providers will be made at the end of a 120-day implementation period, which is Oct. 1.

Nine other trades with gaps totaling $2.4 million have entered the outsourcing process: electricians, instrument trade, machinists, millwrights, riggers, field fabricators, shop fabricators, road and yard service and yard crane service. Members of each work group have 30 days to analyze their costs, quality and service data, then 90 days to determine solutions to close economic gaps.