Pillowtex idles three NC plants
December 11, 2000,
KANNAPOLIS, NC -Following the precedent set by competing mills, Pillowtex announced the temporary shutdown of several of its plants here in an effort to cut back on the amount of inventory idling in its warehouses.
Danville, VA-based Dan River, Fort Mill, SC-based Springs Industries and New York-based WestPoint Stevens have logged, or will log, significant shutdown time this year, with periods ranging from a week to a full month.
Allen Oakley, executive vp of manufacturing for Pillowtex, had previously told Home Textiles Today a shutdown of the companies' gray mills sheeting plants, specifically the weaving processes, was "very, very likely," a result of three poor quarters of retail sales and the prediction of a slow fourth quarter. The decision to ultimately stand down was made on Nov. 30, Mallo said, and employees were informed when they reported for work on Dec. 3.
Mallo said Pillowtex wanted to make perfectly clear the shutdowns were not a result of the financially beleaguered home textiles manufacturer's recent Chapter 11 filing. It was, however, a move aimed at trying to cut down on the high inventory levels that had accumulated.
"This is a routine standing," he said. "The timing is unfortunate, but that is why we have taken great pains to distinguish this closing from others."
Predictably, the approximately 750 employees of plants 4, 11 and 16 are concerned the shutdowns will become permanent. But Rich Resua, district manager, Union of Needletrades, Industrial and Textile Employees (UNITE), was not worried.
"I have all the confidence in the world the plants will reopen when they are scheduled to," Resua said. "This is a viable, money-making company that has just incurred too much debt."
However, Resua acknowledged, the possibility of permanent layoffs could not be entirely discounted.
A deal was negotiated between Pillowtex and UNITE for employees to receive a full week's holiday pay for the week of Dec. 24. Those employees who return to work when the plants reopen next month and remain on the payroll until Jan. 11 will receive an extra full week of pay and should they stay with Pillowtex up to Jan. 25 they will also receive another full week's pay. In addition, employee contributions to the insurance program will be paid by the manufacturer for the entire month. Mallo also said that under state law the temporarily laid-off workers will be eligible for unemployment benefits for three of the four weeks they will not be working.
"This should not be perceived as the beginning of the end," Mallo said. "There is a future at this facility."
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