London Fog, union meet for talks

August 10, 1994|By Ross Hetrick | Ross Hetrick,Sun Staff Writer

NEW YORK -- Company and union officials yesterday began a new round of negotiations aimed at saving London Fog Corp.'s Maryland plants, scheduled to be closed in October, as the possibility of a state role emerged.

Following a two-hour session here, negotiators for London Fog and the Amalgamated Clothing and Textile Workers union would say only that both sides would meet again at an undisclosed time and place. The three London Fog plants -- in Baltimore, Hancock and Williamsport -- employ 700 workers.

At the same time, the disclosure of an earlier state incentive package that was rejected by London Fog raised the possibility that another state offer is on the table.

Mark L. Wasserman, secretary of the Department of Economic and Employment Development, confirmed that the state had discussed a financial package with the company and the union.

"I began to outline what the possibilities were for our participating," he said. "It was by our standards very generous."

He would not give the details of any past or present proposal.

According to Cosimo C. Abato, a lawyer for the Baltimore regional office of the union, previous negotiations had stalled because the company had rejected an incentive plan offered by the state, holding out for a higher offer.

He said the state had offered a $9 million package of tax abatements and other relief on a city-owned building in Baltimore as part of a deal to keep two factories open -- in Baltimore and Hancock -- saving about 600 jobs, and close the Williamsport plant with about 100 jobs. The aid was to include $5 million the first year and $2 million in each of the next two.

For instance, one source of relief could be the $24,435-a-month rent London Fog pays for its 54,000-square-foot plant in Baltimore, which was built for the company in 1989 by Baltimore's quasi-public economic development arm for $3.5 million.

If the state, which holds the bonds on the building, requested a rent reduction, it could be accommodated, said Robert L. Hannon, executive vice president of the Baltimore Development Corp. "It would not be a problem," he said.

But Mr. Abato said that on July 18 the company called the union to cancel further negotiating sessions because the state would not agree to a $13 million aid program.

Under the company plan, he said, London Fog would have received $9 million in incentives in the first year and $2 million in each of the next two years.

The company announced the October timetable for closing the plants on July 29.

Arnold P. Cohen, the chairman and chief executive officer of London Fog, yesterday expressed unhappiness with Mr. Abato's comments but declined to comment on their substance.

Mr. Cohen did not attend yesterday's session. London Fog was represented by President Douglas C. Hillman, Executive Vice President Edward L. Frey and company attorney Peter Walker. Representing the union were Mr. Abato, Baltimore regional manager Carmen S. Papale and Arthur Loevy, secretary-treasurer for the national union.

Following the meeting, Mr. Loevy read a brief union-company joint statement announcing the plans for further talks. "They will continue to work on possible ways of preserving jobs," he said. "Because of the delicate nature of these talks, the parties will have no further comment."

London Fog announced in late July that it would close the plants because it costs $18 more to produce a coat in its Maryland plants than overseas. London Fog and the union had been locked in a dispute for months over management's request to the union to drop an arbitration case that hinders imports of London Fog rainwear.

The union had sought guarantees for its members' $7.60-an-hour base-pay jobs beyond the October 1995 date offered by the company.

Mr. Wasserman said the state made its offer in an effort to jump-start talks between the two sides after they deadlocked June 14. "What we've seen is movement from the public sector. What we have not seen is movement from the other sectors," he said. "On our own, we can't solve this problem."

The talks also involved concessions on wages and other benefits, Mr. Abato said. He said the company was willing to discuss guaranteeing work for three years -- a key union request -- although how many hours per worker would be assured was still undetermined.

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