New Era’s plant in Derby will remain open
By FELICE E. KRYCIA
The Sun associate editor
New Era Cap Company is staying in Derby.
Members of the Communications Workers of America, the union which represents the work force at the plant located in Derby, ratified an agreement Tuesday (Feb. 2) that insures the plant will stay open and become the company’s only manufacturing facility based in this country.
According to Paul Gallagher, a spokesperson for New Era, the company has faced some difficult decisions over the past year as the demand for sportswear and clothing apparel dropped after the economy went into a recession.
“People use discretionary income to purchase these items, and when there is less ‘extra’ money, these types of purchases drop off,” Gallagher said.
That led to a re-evaluation of the operating facilities in the United States.
Late last year, New Era announced they would close their factory in Jackson, Ala., which employs 322 workers, and also their warehouse in Mobile, Ala., which employs 70 workers.
The factory is scheduled to close this month while the warehouse will close sometime by the end of April or the beginning of May.
The company has worked with the Teamsters union and is offering severance packages to employees and has set up a fund for further education or job training to help them find other jobs.
New Era then had to decide which one of the remaining two plants it would keep, the 12-year-old site in Demopolis, Ala., which employs 351 workers, or the original 1960s site in Derby, which employs 330 workers.
The CWA represents the workers at both these sites and there was a lot of dialog between them and the company over the past few weeks.
“No matter how you look at it, people would be losing jobs and that is a hard choice,” said Gallagher.
The company began meeting with CWA officials Wednesday (Feb. 3) to discuss severance packages for all the employees in the Demopolis facility, Gallagher said.
“Both plants are highly efficient and have made enormous contributions to New Era’s success over the years,” said Christopher Koch, New Era’s chief executive officer. “In the end, our decision to keep Derby open was based largely on the need to retain our most senior and experienced unionized employees. This was an incredibly difficult decision to make.”
“Derby has been the most efficient of the three factories in the U.S.,” said Gallagher.
Along with discussions with the CWA, there were also discussions with local and state economic development officials in both Alabama and New York.
“In November we heard that the Derby facility could possibly be closed,” said Evans Town Supervisor Fran Pordum. “I contacted Chris Koch, who explained to me they would be closing one of the two remaining facilities. We got on it right away to do whatever we could to keep them here. We called the governor’s office, Brian Higgins, Jack Quinn, Senator Schumer, the Erie County Industrial Agency, the Economic Development Office, Empire State Development and Jeff Rabey (superintendent of the Lake Shore Central School District) and we were able to put together a $3 million abatement to help keep them here. We did a full court press on this. If we didn’t come up with a competitive package they would have gone to Alabama. I feel sorry for those people there who will lose their jobs but I’m really happy for our residents who will still be employed here.”
The Derby plant has been operating with about one-third of its work force on temporary layoff.
“ These workers may be called back as early as late summer, if the economy rebounds and sales increase,” said Gallagher.
Inventory from the other locations will need to be used up before there is an increase in production at the Derby location.
New Era exclusively manufactures the baseball caps worn by professional baseball teams in the minor and major leagues, along with producing caps sold to the public, including 2.8 million caps made in Derby last year.
“At some point we will catch up due to the increase in demand,” said Gallagher. “Hopefully we will be at full capacity by the end of summer. We will need to run at full capacity for awhile before we will consider offering new jobs. These would be offered first to our previous employees in Alabama before we would open it up to the general public. We will evaluate were we stand before we offer any new jobs.”
The company began in 1922 under the name of E. Koch Cap Co. before becoming New Era Cap Company in 1922. Headquartered in Buffalo, they also has offices in California, Canada, Japan, Hong Kong and Europe.
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