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BEVERLY--The manager of the AHF Products hardwood flooring plant in Beverly said officials are looking over the details of a proposed health care plan for employees before coming back to the negotiating table with Teamsters Local 175 union representatives.
"This is a big piece of contract negotiations and once we do sit back down at the table again, that's where we'll start," Blaine Emery, AHF's plant manager, said in an interview with The Inter-Mountain this week. "We've got to understand, not just this period of time, but what's the long term effects of making a decision to move that because we have responsibilities to protect our employees and not allow them to get into something that may not work out well."
AHF has requested information about the potential health insurance plan that the Teamsters have said they could offer the employees, presenting the union with a list of questions and requests for legal documents, which the union has been responding to, he said.
"The union's been very cooperative in getting us all of that information. The outside consultants that we use to give us good advice on our healthcare plan, they've been very helpful, so I've been encouraged by the entire conversation thus far," said Emery.
AHF and the union group are continuing to attempt to reach an agreement for a new three-year contract for employees. On Feb. 23, 93% of the AHF Products hardwood plant voted against AHF's proposed contract renewal but are currently working on a day-by-day basis. The Beverly plant employs approximately 500 local residents.
The reasons for voting against the contract were listed as increased health insurance costs and a proposal to freeze pensions and introduce 401k plans.
On average, employees in the manufacturing field pay 27% of their healthcare costs, while various AHF employees are paying as little as 12%, Emery said. "We want it to be fair. We want everybody to be paying their fair share… Because it's such a big move for (those individuals), it gets a lot of attention," he said.
As for retirement plans, AHF is proposing to lock pensions in place and introduce 401k plans for union employees.
"They way that pension worked was for every year you worked up to 30 years, you can accrue so much money. Once you hit that 30-year mark, that's a ceiling… You've earned your pension, but what we're going to do is freeze it (where it is now)," said Emery.
AHF's 401k plan would match employee contributions at 6% for the first two years before dropping to 3%.
"That group would still have their pension and they're going to have a 401k that the company is putting money in every paycheck. The beauty of the 401k is that money is yours forever," said Emery.
Ken Hall, president of Teamsters Local 175, stated in a press release Tuesday that, "AHF proposed to eliminate the employees' pension plan and replace it with a 401k plan. The company continues with that proposal even though 401k plans have lost significant money due to fears surrounding the coronavirus epidemic."
While waiting for AHF and the Teamsters to resume negotiations, union employees have continued showing up at the Beverly plant as scheduled and doing their jobs without a contract.
"It's been business as usual, everyone's showing up to work. Our union members are working as hard as they always work and we're very proud of them," Emery said.
However, Hall warned that union employees would not wait forever.
"Our members have shown an incredible amount of tolerance by continuing to work after the contract was rejected by 93%. However, the company's refusal to even schedule an additional bargaining session is trying the patience of these employees," Hall in Tuesday's press release.
"The company's refusal to bargain on the last scheduled day of negotiations as well as its continued refusal to schedule additional negotiations is indicative of a company who is trying to provoke a strike," Hall said. "Our members are fed-up with the company's behavior and will not continue to sit around while AHF continues its bad behavior. Enough is enough."
AHF is the only hardwood flooring plant in the state of West Virginia and Emery said company officials take pride in using mostly local lumber to make the plant's products.
Declining markets for hardwood products is having an impact on the industry in the Mountain State, an official said.
"One of the things that we've looked at as an association is how to make West Virginia a little more attractive or a lot more attractive for manufacturing investment," Rebecca McPhail, president of the West Virginia Manufacturers Association, told The Inter-Mountain this week. "During the recession (that ended in 2009) we saw a pretty sharp decline nationally in terms of manufacturing jobs
"We looked regionally at job growth in manufacturing and, unfortunately, from a regional perspective, West Virginia's been manufacturing's biggest loser, if you will, in that all the states around us have made significant gains in manufacturing jobs and we're the only ones regionally that are at a deficit post-recession," she said.
West Virginia has lost roughly 15,000 manufacturing jobs since the recession, McPhail said.
"Despite the fact that we're an energy state, it may seem kind of counterintuitive but we're middle of the road at best in terms of what it costs for our manufacturers to operate from an energy perspective," McPhail said. "We've got a pretty unhealthy workforce in West Virginia and that shows in the premium increases that we've seen over the last several years… There's no one thing that impacts the whole but when you take all of these variables and put them together, we've got some challenges."
Emery said the wood industry overall is a shrinking market. "You can go to Lowes or Home Depot and you can buy a multitude of other things that aren't wood that look like wood," he said.
AHF officials have ensured that the lumber they purchase is harvested sustainably and that none goes to waste in order to keep the business going, he said.
"Who we buy from and who they get the logs from, this is all regulated now by an industry that does nothing but sustainable lumber practices," Emery said. "The beauty of this industry is that it's 100% sustainable… To timber a forest is actually the best thing you can do for it."
About 55% of the lumber that AHF buys is used in flooring. Beyond that, the imperfect pieces are turned into sawdust and sold to other manufacturers to make wood pellets and other compressed wood products.
AHF, a subsidiary of American Industrial Partners, purchased the plant from Armstrong Flooring in 2018 before expanding on the existing building.
In November 2019, AHF Products held a ribbon cutting to honor the new 85,000-square foot expansion to the Beverly plant, which was expected to add up to 50 new jobs within the facility.