Tower Automotive Granite City facility transition agreement approved

By Caroline Salls

Pittsburgh, Sept. 20 - Tower Automotive, Inc. obtained court approval of the transition agreement in connection with the closure of the Granite City, Ill., facility, according to a Wednesday filing with the U.S. Bankruptcy Court for the Southern District of New York.

The Granite City employees are represented by the International Union, United Automobile, Aerospace and Agriculture Implement Workers of America, UAW.

Under the transition agreement:

• Bargaining unit employees with seniority under the collective bargaining agreement who are laid off as a result of plant closure will receive 20 hours of severance payment for each year of service, capped at 26 years, at the employees straight time hourly rate;

• Employees with less than one year of seniority will be entitled to one week's pay;

• To be eligible for severance, the employee must have been laid off after Oct. 13, 2005, remained employed through the last day of assigned work and signed a release;

• The company will encourage employees to take all accrued vacation before termination, but Tower will pay all accrued vacation not taken in the payroll period immediately following termination;

• Health care and dental coverage will be provided for the collective bargaining agreement period through Cobra, provided that any Tower benefit contribution be credited toward, and not in addition to, the 18-month Cobra period of eligibility;

• The company will continue to pay all sickness and accident and short-term disability benefits within the terms of the applicable plan; and

• If Tower reopens the Granite City facility at any time within three years, it will offer employment exclusively by seniority to any employees who were accruing seniority immediately before the agreement effective date and who apply within 45 days of any public announcement of reopening.

The Novi, Mich.-based auto parts maker filed for bankruptcy on Feb. 1, 2005. Its Chapter 11 case number is 05-10578.

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