By  on May 26, 1994

NEW YORK -- The House Subcommittee on Labor-Management Relations has authorized hearings into The Leslie Fay Cos.' plan to close its plant in Wilkes-Barre, Pa., which would eliminate more than 1,200 jobs.

A spokesman for Rep. Pat Williams (D., Mont.) said late Wednesday that oversight hearings, which are strictly fact-finding in nature, have been authorized, although no date has been set.

He said the House hearings would be coordinated with Senate hearings.

The action comes as the contract negotiations between Leslie Fay and the ILGWU approach a May 31 deadline. Leslie Fay announced in March it wanted to close its domestic production facility and switch to imports to compete better. The ILGWU says the company just wants to bust the union and ship production to low-wage countries.

Joel Cohen, an outside labor council for Leslie Fay, said this is an "attempt to politicize rather than negotiate."

"Instead of addressing a serious problem of jobs that lose money for the company, they choose to bring this to a political level," Cohen said.

Cohen added that he would hope that in the hearings, Congress would look at the situation of liquidated damages, in which manufacturers pay a fee to the union for imports. Leslie Fay has sued over this contingency, calling it a violation of labor laws.

In a separate move, the ILGWU said Rep. John P. Murtha (D., Pa.) has asked the U.S. Customs Service to rescind its reduction of a huge customs penalty owed by Leslie Fay. The penalty was reduced from $104.3 million to $3.9 million. Cohen said the company committed no crime, and is negotiating to lessen or throw out the penalty altogether.

Murtha's office was unable to confirm this action Wednesday evening.

Meanwhile, the union also said Wednesday that Pennsylvania Governor Robert P. Casey has offered Leslie Fay "significant state financial and other assistance if it reconsiders its decision to close its plant." The union said the governor sent a letter to Leslie Fay president Michael Babcock offering assistance through low-interest loans, help in modernizing its operations and job training funds to upgrade worker's skills.

The state offices in Pennsylvania were closed at press time.To this, Cohen said Leslie Fay is willing to listen to any proposal the governor has to help retrain the workers, which Leslie Fay has said all along it wants to do.

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