The Gaming Den

By Kari Lydersen
Washington Post Staff Writer
Tuesday, December 9, 2008; Page A02

CHICAGO, Dec. 8 -- Workers occupying a Chicago factory that closed abruptly last week gained a significant political ally Monday in their fight to receive back benefits, when Illinois Gov. Rod Blagojevich (D) ordered state agencies to stop doing business with Bank of America until it uses some of its federal bailout money to keep the factory open.

The standoff at Republic Windows & Doors, which began Friday, has been a throwback to tactics hardly seen since the 1930s that labor experts and union leaders say may become more common if the economy continues its downturn.

More than 200 unionized employees say they will not allow Republic or its creditor, Bank of America, to remove equipment from the factory until they get severance and vacation pay they are owed. Their union alleges that Republic violated federal law by giving its workers only three days' notice before shutting down. Workers were told the company was closing because Bank of America did not extend it enough credit to keep operating.

The sit-in has garnered support from a number of Illinois Democrats, including President-elect Barack Obama. "I think they're absolutely right," Obama said Sunday, adding: "What's happening to them is reflective of what's happening across this economy. . . . These workers, if they have earned these benefits and their pay, then these companies need to follow through on those commitments."

Blagojevich said the state will withhold business worth "hundreds of millions" of dollars from Bank of America unless it steps in to help the workers. "We hope that this kind of leverage and pressure will encourage Bank of America to do the right thing for this business," the governor said outside the plant.

Bank of America said in a statement, "We agree with the statements of public officials that Republic Windows and Doors should do all it can to honor its obligations to its employees," but added that the bank has "provided the maximum amount of funding we can."

Meanwhile, the Illinois Attorney General's Office is investigating Republic Windows' labor practices as well as possible contract violations with customers in regards to the sudden closure. Officials with Republic did not return phone calls seeking comment.

Employees were told Dec. 2, during a gathering in the cafeteria, that the company would close in three days. By Friday, their health benefits were terminated.

At a meeting facilitated by leadership of the United Electrical, Radio and Machine Workers of America Local 1110, employees voted to remain in the plant until bank and company officers agreed to either keep the business open or pay them 60 days' severance wages and accrued vacation time.

"You don't like to hear news like this at this time of year," said worker Apolinar Cabrera, 44, a father of two who has a baby due soon. "Can you imagine paying your mortgage, your bills, food and a new baby coming? What are you going to do? We'll stay here as long as it takes -- we have no choice."

The Worker Adjustment and Retraining Notification Act of 1988 mandates that companies give workers or their union 60 days' notice of a closing or of mass layoffs. Exceptions include natural disasters, unforeseeable business circumstances, or situations in which the company is seeking new capital or business that would be endangered by such notice.

Emily Rosenberg, director of the Labor Education Center at DePaul University's School for New Learning, said the Republic situation probably does not fall into one of those exceptions.

"It's not my impression that banks give you two days' notice," she said. Company officials "probably knew they were going under and, instead of looking at the employees as creditors like they should have, they said to hell with them and thought nobody was going to do anything about it," she said.

Company officials allowed union members to remain in the plant if they promised to keep the equipment safe and clean. Since then, 30 to 40 workers at a time have remained inside, while supporters from other unions and the public have milled around the factory's lobby and sidewalk.

New York lawyer Hanan Kolko, who represents various unions, said that because Republic did not file for bankruptcy before it closed, the workers' claims will be considered preexisting debts, with low priority in any bankruptcy proceedings.

"If Bank of America acts like a typical secured creditor, when someone says, 'Gee, these workers should get their WARN Act money,' Bank of America will say, 'Hell no, they shouldn't get a nickel, because that will diminish what we get,' " he said. "If the effect of the bailout is that banks do okay and these people who were making $28,000 a year are denied their WARN Act money and then disappear into the miasma, then something is not right."

Illinois governor arrested for trying to sell Obama senate seat

4 hours ago

CHICAGO (AFP) — The governor of Illinois was arrested Tuesday on charges of conspiring to sell an appointment to president-elect Barack Obama's recently vacated US Senate seat in what prosecutors called "a political corruption crime spree."

Governor Rod Blagojevich and his chief of staff, John Harris, were also accused of demanding kickbacks for government contracts, jobs and appointments and trying to get certain editors fired from the Chicago Tribune newspaper because of their critical coverage of his administration.

"The breadth of corruption laid out in these charges is staggering," US attorney Patrick Fitzgerald said.

"They allege that Blagojevich put a 'for sale' sign on the naming of a United States senator; involved himself personally in pay-to-play schemes with the urgency of a salesman meeting his annual sales target, and corruptly used his office in an effort to trample editorial voices of criticism."

"Governor Blagojevich has taken us to a truly new low," Fitzgerald said at a press conference, adding that the state's top leader "has been arrested in the middle of what we can only describe as a political corruption crime spree."

Obama said he was not aware of allegations that Blagojevich - who as governor is charged with appointing a US senator when a seat becomes vacant - was shopping it around to find the highest bidder.

"I had no contact with the governor or his office, and so I was not aware of what was happening," Obama told reporters.

"Like the rest of the people of Illinois, I am saddened and sobered by the news that came out of the US attorney's office today," the president-elect said, adding that it would not be "appropriate" for him to comment further on the ongoing investigation.

Blagojevich was released on a 4,500 dollar bond Tuesday after making a brief appearance before a federal judge in Chicago. His office did not immediately respond to a request for comment or calls for his resignation.

Fitzgerald made no allegations that Obama was aware of any scheming by the governor. The complaint included descriptions of recorded conversations in which Blagojevich complained bitterly that while Obama's team had a preferred candidate in mind, "they're not willing to give me anything except appreciation. (expletive) them."

Fitzgerald said the breadth of alleged corruption by Blagojevich was "appalling," especially given that the governor had known he was under investigation for years.

"You might have thought in that environment that pay-to-play would slow down. The opposite happened," Fitzgerald said.

Blagojevich was allegedly intercepted on court-authorized wiretaps comparing himself to a sports agent shopping the seat to the highest bidder, according to the 76-page criminal complaint.

Authorities allege he considered taking the seat himself to avoid impeachment by the Illinois legislature and to remake his image for a potential run for president in 2016.

In a conversation recorded the day after Obama's historic November 4 win, Blagojevich told an unnamed advisor: "I've got this thing and it's (expletive) golden, and, uh, uh, I'm just not giving it up for (expletive) nothing. I'm not gonna do it. And, and I can always use it. I can parachute me there," the affidavit states.

Democrat Blagojevich was elected in 2003 after vowing to reform the culture of corruption surrounding his predecessor, Republican George Ryan, who is currently serving more than six years in prison for corruption.

Blagojevich was soon involved in corruption scandals of his own as federal prosecutors investigated a host of allegations of pay-to-play politics including insider-dealing, influence-peddling and kickbacks.

Fundraiser Tony Rezko, who is a former friend of Obama and had close ties to Blagojevich, was convicted earlier this year on corruption and bribery charges.

The charges against Blagojevich also include allegations that he held back state funds from a children's hospital and highway project in order to pressure a contractor and the hospital's chief executive officer to donate money to his campaign.

Blagojevich, 51, and Harris, 46, were each charged with conspiracy to commit mail and wire fraud and solicitation of bribery. If convicted they face a maximum of 30 years in jail.