Republic Doors and Windows Shuts Down Operations

Just as our government is at the core of the problem in the housing market foreclosure crisis, it appears as if our government is a part of the root cause of problems for workers at Republic Doors and Windows.

Republic Doors and Windows, a Chicago based manufacturer apparently ran into financial difficulties and was forced to close their doors which subsequently led to almost 300 workers being laid-off with only a few days notice. The workers are protesting by staging a sit-in on the company property.

Essentially, Republic Doors and Windows was losing money and Bank of America refused to provide any more loans to the company which forced the shutdown. The workers contend that they are due severance pay and should also be paid for any accrued vacation time. They also claim a violation of the Warn Act which stipulates that employees are to be warned about a closing at least 60 days in advance. Unfortunately, the Warn Act is full of loopholes, lacks a solid enforcement provision, and is frequently disregarded.

Currently, Illinois Governor Rod Blagojevich, Illinois Senator Dick Durbin, President-elect Obama, reverend Jesse Jackson and other high powered officials have weighed in on behalf of the workers and are presently attempting to force Bank of America to loan money to Republic Doors and Windows ostensibly to fund the payments to the former employees.

This is a sad consequence of the economic slowdown. However, an unemotional analysis of what should be done seems to be lacking and it appears that there is much more to this story. Currently the story is being framed in a manner that focuses attention on Republic Doors and Windows, Bank of America and the workers. However the underlying causes appear to be the ineffectiveness of our government in enforcing current law and fixing the loop holes that are contained in the Warn Act.

The story keeps unfolding concerning the activities of the owners of Republic Doors and Windows. Republic issued a press release which outlined a chronology of events that led to the closing. Notable within the press release is the formation of another company by the owners of Rebublic Doors and Windows called Echo Windows in November 2008. Even more notable is that last week, Echo Windows announced the purchase of the window manufacturing division of TRACO, a company located in Iowa. The Chicago Tribune carried an in depth story concerning Republic Doors and Windows.

Now even larger questions come into play concerning Republic Doors and Windows. Are the owners attempting to dodge their legal and moral responsibilities to workers? Have they been shifting assets to another company? Is that legal? Note that Republic Doors and Windows is not in bankruptcy, they are simply shutting down what has been a money losing endeavor.

The Warn Act previously mentioned seems to be the major issue. The AFL-CIO news blog contains a review of the act and what the intentions of the legislation were. Republic Doors and Windows was aware of the provisions as noted in their press release. However, our government rarely enforces the provisions of the law without workers entering into an expensive and drawn out lawsuit. Therein lies the problem. If Republic Doors and Windows believed that the provisions of the Warn Act would be strictly enforced, then one has to believe that their decision making would have been reflective of that reality.

So the questions remain. Do the workers have a legitimate claim? Certainly it appears as if they do. Should Bank of America be forced to make a loan that surely will not be repaid? That appears unfair. The dilemma, as always, is about money. However, it appears that the US government has contributed to this fiasco. The government could have taken action years ago to strengthen the provisions of the Warn Act, but did not.

Over the coming days there will more revealed about this story. Regardless of how the situation is resolved, it looks more and more like the US taxpayer will foot the bill. Even if Bank of America provides a loan, the money will have been provided by taxpayers.