February 27, 2003
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Company chief says headquarters may relocate in future—
Vernay Labs adjusts layoff schedule

Vernay Laboratories has once again tweaked its closing plans and the number of employees who were scheduled to be laid off Friday, Feb. 28, has dwindled down to five from 30.

Management notified workers of the change on Monday, union leader Ralph Foster said, giving the five a chance to decide their options and the other 25 a slightly prolonged work schedule.

In addition, the company’s president and CEO, Tom Allen, said this week that Vernay may eventually relocate its corporate headquarters out of town.

The jobs being eliminated this week include two skilled trade toolmakers and three line molding production jobs. Two of the employees have put in over 13 years with the company, two have over 19 years seniority and one has been with Vernay for more than 25 years.

Employees say they’ve been expecting to leave.

Mold inspector Ron Cosby, who lives in Xenia, said it’s hard to decide what to do after being with the company so long.

“I’m ready to move on, honestly,” he said. “The last few weeks it’s been hardest just to be able to say this is what I’m going to do next.”

Vernay’s layoff and plant closure schedules have changed several times since last fall. The first round of layoffs was originally scheduled for late September, but instead took place in mid-October.

“We’re moving slower than we had anticipated,” Allen said on Monday. “It’s hard to describe to people who aren’t familiar with this moving process.”

Much of Vernay’s automotive parts manufacturing is currently being moved to the company’s plants in Georgia and South Carolina.

Allen indicated that customer involvement in the manufacturing implementation process down south was the main reason the schedule has been so unpredictable.

“Each customer has the right to approve the new product, set up testing and make sure the parts are being produced at a consistent quality level,” Allen said. “We’ve been trying to honor our customers’ desires to be a part of the revalidation process.”

The timing of this process depends on how involved the customers want to be with the product they are purchasing, he said.

Allen said he is aware that it is stressful for employees to have to wait and not know when they will lose their jobs. He said the company is trying to reach a balance between satisfying the needs of its customers and its employees.

Vernay initially announced the closing of its two Dayton Street plants in June 2002. It cited as reasons for the closure the company’s excess manufacturing capacity, a shifting customer base and a desire to facilitate the environmental cleanup of its local facility, under the direction of the U.S. Environmental Protection Agency.

Since last summer, 55 workers have been laid off in three rounds in October, December and January, and dozens have left to take early retirement.

Plant 3, the large plant that handles automotive parts, is now scheduled to close sometime in June or July, a few months ahead of the previously estimated time frame, Allen said. The company originally planned to close the plant at the end of 2002, but revised the closure to September.

Both the smaller medical device plant, or Plant 2, and Vernay headquarters and research facilities will remain open longer, though how much longer is difficult to estimate.

Allen said the corporate headquarters located on East South College Street could become too small to house the management group that will be coming over from Dayton Street once the plants start closing. Vernay is waiting to finalize its contamination cleanup schedule with the EPA, to make a decision about possibly relocating.

“Once we get our remediation plan approved we may be forced into a decision where we’ll look elsewhere,” he said. “We may relocate our corporate offices to another location in Dayton or somewhere else in the Southeast.”

EPA project manager Trish Polston tentatively projected the final corrective measures for cleanup to come together close to 2005, though the predicted interior cleanup measures will have been implemented prior to that time.

In the meantime, operations are slowly shifting out of Yellow Springs.

Foster estimates there were 320 employees working in plants 2 and 3 a little over a year ago. Now the number is down to 80 to 85 people in both plants. Plant 3 is already 65 percent empty, Foster said, with big semis loading equipment from the plant for transport on a regular basis.

“They are emptying plant 3 fairly quickly,” he said. “It’s quite bare.”

Plant Manager Mike Maloy said that roughly 50 more workers would be laid off before the closing of plant 3, though the schedule for those layoffs will not be available for another two to three weeks. After the big plant closes, he estimated that around 40 employees will be left in the small plant and 55 management positions left at headquarters.

—Lauren Heaton