Workers who took over and occupied their Chicago factory have won a startling victory.
The occupation of the Republic Windows and Doors factory began after management tried to shut down the plant without notice and without paying wages or compensation to workers.
After six days of occupation – which was headline news across the US – the workers voted to accept a $1.75 million agreement.
Each will get eight weeks’ salary, all outstanding holiday pay and two months’ paid healthcare. It works out at about $7,000 for each worker.
The plant’s owners, union leaders and the Bank of America came to an agreement on Wednesday of last week.
The reason behind the closure was that the Bank of America had cut off credit to the company. This is the same bank which pocketed $25 billion of public money in a government bailout.
The workers’ action forced the bank to stump up $2 million to pay them the money they were owed in a matter of days, despite the fact it was not legally obliged to do so.
The occupation involved mainly Latino workers, part of a community that was galvanised by the huge protests for migrant rights in 2006.
The action had two effects. First, it has popularised the idea that bailouts should not just be for bankers but for ordinary people facing the loss of their homes, jobs and healthcare.
Second, it has revived a powerful tradition of occupying to win workers’ rights. The 1930s saw a wave of factory occupations that won massive gains for workers.
The Chicago Tribune newspaper this month ran a piece on “how to conduct a successful sit-in” – stressing the importance of winning solidarity in order to turn an occupation into a nationwide rallying point.
One reason for this may be the fact that the Chicago Tribune is facing closure itself.
One of the final acts of George Bush’s administration has been to step in to offer short-term financial aid to the car industry. This speaks volumes.
The three US car giants – General Motors (GM), Ford and Chrysler – will receive the aid. This will go ahead despite the fact that Republican senators blocked a $15 billion loan, demanding that unions accept huge cuts in wages and benefits instead.
The White House and treasury provided temporary relief – alarmed that the collapse of one of the companies would lead to a new round of market panic.
Yet the cash will only postpone the crisis till next month, when Barack Obama becomes president.
Between them GM and Chrysler owe their suppliers about $10 billion for parts that have already been delivered.
GM’s cash reserves are falling by more than $2 billion a month, and the company has hired bankruptcy advisers.
Chrysler’s sales are falling faster than any of its rivals, and it will soon run out of money.
GM, Ford and Chrysler directly employ 239,000 people in the US, while the country’s 3,000 or so auto suppliers employ more than 600,000 workers.
Chrysler announced 5,000 job cuts at the end of November while GM has said it will reduce vehicle production in the first three months of 2009 by 250,000 units.
The government rescue plan will not stop massive closures and lay-offs. This was acknowledged by Obama, who said that “restructuring” is vital.
The recent Chicago occupation shows that workers can win their demands.
The most radical demands are for all jobs to be saved and for workers to be retrained and redeployed so that their skills can be used to produce things that people actually need.
The United Auto Workers union should make these demands central to a campaign to defend workers’ jobs.