Jobs go south

>> Gildan closes its Montreal factories
and moves to cheaper pastures

HONDURAS BOUND: Gildan’s factory on Montée de Liesse

by PATRICK LEJTENYI

When Gildan, the Montreal-based textile manufacturer, announced last week that it would be closing its two factories here in August, it didn’t shy away from explaining the reason. It was all economic: concentrating their knitting and sewing operations in Honduras, Nicaragua, the Dominican Republic and Haiti was key to remaining competitive with lower-cost imports from Asia. A cutting facility in upstate New York will close in August as well, but two sewing facilities in Mexico will close immediately. Gildan’s corporate headquarters will remain in Montreal, but relocated from Ville St-Laurent to downtown.

The Montreal closure will put at least 160 people out of work, all of them members of the Teamsters union and all of them, says Teamsters spokesman Stéphane Lacroix, “néo-Québécois”—first- or second-generation Quebecers. This, he says, despite the proven record of success at the plants on Louvain and Montée de Liesse.

“All kinds of efforts were made on the part of the workers to increase the factories’ profitability and productivity” during the last round of collective bargaining in 2005, says Lacroix. “They produced 20 per cent more this year than last, and were even given a bonus” averaging about 15 per cent of their salaries. But that didn’t save them from the axe.

“I think this decision [to close the plants] was made years ago,” he says.

See you in Central America

Odds are he’s right. Gildan spokeswoman Geneviève Gosselin says that Montreal’s loss is a gain for poverty-stricken Central America and the Caribbean. With two main production hubs in Honduras under construction, and current factories in Honduras and the DR operating the majority of the knitting, dyeing and finishing, and with sewing facilities in Nicaragua and Haiti, the company has “the advantage of everything being integrated,” she says. “The manufacturing plants are being integrated in order to be more cost-efficient and to take advantage of trade agreements with the United States, which represents 88 per cent of our market. With these locations, we can ship duty- and tax-free.”

Lower production costs also help, but, she says, don’t call their new “state of the art facilities” sweat shops. Not even the Maquila Solidarity Network (MSN), a Toronto-based non-governmental organization that focuses on human rights for manufacturing employees and a frequent Gildan critic of the past, would do that.

Bob Jeffcott, an MSN policy analyst, says that in the past, their relationship with Gildan “was very difficult, to say the least,” but that in the past few years it has improved dramatically, because the company has “learned to listen to its critics and consult with them.” The MSN had criticized Gildan loudly and often over its decision in 2004 to close a Honduras factory in 2004, saying the company only closed its doors to prevent workers from “exercising their associational rights and to retaliate against workers for complaining to outside parties about rights abuses.” The company eventually agreed to re-hire the workers and give them first-hire preference, although Jeffcott says their entire lobbying efforts were only “partially successful.”

But they remain concerned about factory closures in Mexico, where many textile companies have shut their doors to move to cheaper locations south and far, far east. “That’s the norm in this industry,” he says.

Gosselin says Gildan is a good corporate citizen everywhere it does business. “We are working with MSN and other non-governmental organizations to ensure that our employees are treated well. We pay fair wages, we run an employment office for those who have lost their jobs and have opened clinics to facilitate their transition.” They’ve also hired outside auditors Verité to monitor their Central American factories.

In Montreal, says Gosselin, “We’ve given the workers more than the legally required 12-weeks’ pre-notice, generous severance packages and made available placement and re-training services.”

Money matters

But that doesn’t wash for the unions here. According to a press release dated Wednesday, March 28, the day after Gildan announced its impending factory closings, Henri Massé, the president of the Fédération des travailleurs et travailleuses du Québec (FTQ), excoriated Gildan for cutting costs even as it was making good money. Massé claimed in the release that Gildan made a net profit of $15.6-million in the first trimester of 2007 alone. “In this context, we can speak without reserve of predatory capitalism,” he thundered.

Lacroix says the Teamsters will fight the closure, even though he is not overly hopeful. “We want to find the cracks, the holes which we can use to save the jobs,” he says. “For now, the objective is to keep the factory open. We don’t want to be negotiating severance pay.”