'Complete shock' leaves La-Z-Boy employees scrambling

By Angeline Olschewski

May 6, 2008 | TREMONTON -- On April 2, La-Z-Boy Utah in Tremonton gathered its employees in the warehouse. Mark Nicholas, employed there for 28 years, and his sister-in-law, Melanie Price, along with her husband, Jim Price, employed for 25 years, waited with the crowd.

"Everybody knew something was up because this had never happened before," said Melanie Price. Then the vice president announced that all the cutting and sewing jobs were being sent to Mexico, along with all the cutting and sewing jobs from the other domestic plants.

"And then we will be shutting down La-Z-Boy Utah for good," he announced, according to Price. "It was just a total shock; nobody knew."

She doesn't think the vice president even knew until about an hour before. "He just signed on a brand new house," she said.

"It was a complete shock," Mark Nicholas said. La-Z-Boy told them the export opens up enough workspace in the other remaining North American plants to make the Tremonton facility expendable. With no real warning, 630 workers found themselves looking for a new job.

In a Deseret News story, Kurt L. Darrow, La-Z-Boy's president and chief executive officer, said the decision to close this facility was difficult.

"We are confident this reallocation of resources, combined with the many changes we have made to our production processes, will continue to strengthen our operations," Darrow said.

While La-Z-Boy has said the division of positions into the remaining facilities will open up 400 new jobs, Price said Tremonton's employees would not "get preferential treatment."

"We are welcome to apply for jobs in other factories, but that doesn't mean we get them," Nicholas explained. "We would have to compete with everyone else who wants a job there."

To help with the transition, the company is offering several services to aid employees in finding new work. In addition to La-Z-Boy, Box Elder County is home to multiple plants including Malt-o-Meal, Vulcraft, Autoliv, Nucor, Liberty Foods and soon Proctor and Gamble in 2010. According to Nicholas, this is part of the problem.

"If there were 500 people out here looking for work," Nicholas said, "we wouldn't be closing. But La-Z-Boy won't compete with the other companies in the area for their employees."

When La-Z-Boy opened 30 years ago, it was a family owned business that Nicholas said "considered their employees their greatest asset." It offered competitive wages, an incentive plan that encouraged the employees to work harder in order to earn more money, and good benefits, all of which enticed Nicholas to take a job there to support his wife and growing family.

He even recommended his sister-in-law move to Honeyville and hire on at the plant. He said he was proud to work for a company that made a good product and treated their employees well. But when the company's president died of a heart attack, someone new came in and turned La-Z-Boy into a corporation.

"As soon as they made it a corporation, their focus changed," said Nicholas. "They cut and cut and cut. They cheapened the product ... as much as they could, and the only other place they could cut was on employees' benefits."

Nicholas said the bottom line became paramount.

"For an example of how they've cut and cut," he said, "15 years ago I was on incentive, and I was making good money. Well now we're on a straight wage, but that straight wage is the same as I was making on incentive 15 years ago. For the last two years we haven't got a raise at all."

Still, both he and Price said they didn't see this coming.

"There were some things that La-Z-Boy was having some problems with," Nicholas said, "but things were starting to turn around a bit. So it was a complete shock."

Price was especially shocked because she was recently sent for training on some new software for her position.

"I had gone back to our corporate office which is in Monroe Michigan the week before with my boss," Price explained, "and we were learning a new purchasing system. In fact we were going to go back in May to learn some more and then three days later we were shut down. We had no clue."

But both Price and Nicholas consider themselves some of the lucky ones. For the last eight years, Nicholas has had a part-time boot repair business out of his home, which he now hopes to turn into full-time work.

"I really haven't dared advertise because I stay busy with just word of mouth," Nicholas said. "But with trying to go full time, I know if I go over to Logan or Malad and put an ad in the paper, I would keep busy."

Price has spent her tenure at La-Z-Boy in the office, so she is hopeful that her clerical experience will allow her to find work more easily. Her husband, Jim, is not so lucky.

"He'll be 60 in November," she said. "Both his knees are artificial." This close to retirement and with his physical limitations, he feels the best job option is to get his CDL license, and drive some type of delivery truck in Box Elder or Cache County.

Price said La-Z-Boy is looking into NAFTA's Trade Adjustment Assistance Program, which according to the jobs.utah.gov Web site is, "Available to individuals laid off from employers certified by the U.S. Department of Labor as having been directly affected by increased imports or certain shifts of production to other countries that have a free trade agreement with the United States."

This program provides reemployment services, training services, job search allowances and relocation allowances. Price said the employees are still waiting to hear if they qualify and just who is eligible for the help since only the cutting and sewing jobs were exported to Mexico, but the export made everyone at the plant's jobs disappear.

"It's amazing how many people it affects," Price said. "Not just us, but so many other companies. I had one man that said, ‘This is going to affect me for a year at least' because he's on commission. How many more people is this going to affect other than just the 630 that work there at the plant?"

Price's son, Ty, and Nicholas' daughter, Jessica, are both attending college on La-Z-Boy scholarships, which according to Price will go away.

"These were scholarships by the La-Z-Boy founder's family," Price explained, "and if you're not an employee at La-Z-Boy, you don't get scholarships. So as of this semester, they will quit."

While many employees are concerned about their uncertain futures, Price said she's still focused on the next three months of work.

"Right now, I'm not [worried]," Price said, "But I keep thinking, ‘OK, this is not real.' I think I'm in denial. Somebody's going to call up and say ‘OK, we've changed our minds."

She will confess she's more worried about going out and applying for jobs.

"I haven't applied for a job for 25 years," she said, "and to go out and compete with young girls who've got more education, that does worry me."

The hardest part of the change is not seeing their co-workers everyday, said Price.

"That's the bad part," she said. "You'll miss people out there ... because where are you going to see them everyday? Once in a great while you might see them on the street, but not everyday like you did."

Price said there were also good things that came about because of the announcement. Until recently, it was high-stress if certain parts weren't there on time, and now the project just waits until the parts arrive, she said.

"It's not the cutthroat out there like it used to be," she said. "It's more relaxed now where they can actually have a little bit of fun, like it used to be fun out there."

Both Nicholas and Price expressed feelings of disappointment at how the environment at La-Z-Boy has declined over the years since it stopped being family owned.

"I told them I wish they had been as loyal to me as I was to them," Nicholas said. "I used to be proud to say I worked for La-Z-Boy, but over the last several years I've been embarrassed because of the reputation they have, not just with the product, but with the reputation they have with how they treat their employees."

Nicholas thought the new Proctor and Gamble warehouse might have finally put La-Z-Boy out of business in 2010, but he didn't think it would happen before. Price said she was told they would never close the Tremonton plant.

"It's something you never expect," Price said. "It's just unreal."

She's optimistic for her family's future, and for her brother-in-law's future. She said he's wanted to focus on his business for some time now, and she thinks this forced change will be the push he needs.

As for her future, she said, "We'll be fine. What other choice do we have?"
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