Teamsters draw a line in the sand against private equity firm

Teamsters last week picketed a hazardous materials handling conference in Salt Lake City sponsored by Nexeo, which operates a worldwide chemical distribution business. The Teamsters were protesting Nexeo actions that he union says threaten the health and retirement security of its workers and the health and safety of people who live close to the chemical distribution facilities operated by the company.

Nexeo, a leading distributor of chemicals, plastics, composites, and environmental services, was formed last year when the private equity firm TPG Capital purchased the distribution unit of Ashland, Inc., a worldwide chemical manufacturer.

To make the purchase, TPG Capital borrowed $600 million. According to the Teamsters, the heavy debt load helped inflate the private equity firm’s investment returns, but it also put financial pressure on the company that caused it to scrimp on safety and slash worker benefits.

Teamster Local 705, which represents 35 Nexeo workers at a warehouse in Willow Springs, Illinois, reports that after the TPG purchase, “management . . . began altering existing and expired collective bargaining agreements to increase health care costs and reduce coverage for workers.”  It also unilaterally stripped workers of their pension benefits in favor of a company defined contribution 401(k) savings plan.

The company also began having safety problems at its facilities. The US Occupational Safety and Health Administration fined a Nexeo warehouse in Tewksbury, Massachusetts for mishandling chemicals, which increased the risk of a chemical fire that could endanger workers and people close to the facility.

On June 18, there was a hazmat fire at the company’s Willow Springs warehouse that forced the evacuation of the warehouse.

“It is unconscionable that Nexeo’s new owners would be taking such risks with people’s livelihoods,” said Teamsters Local 705 Business Representative Neil Messino. “Our members and the communities that surround Nexeo facilities deserve better.”

“We want TPG to restore fairness to our members – put safety first and ensure adequate investment in our communities,” said Dominic Chiovare, president of Teamsters Local 70 in Oakland at the Salt Lake City demonstration.

The Salt Lake City demonstration was one of a series of actions that the Teamsters have taken to protest TPG’s treatment of its workers and its disregard for surrounding communities.

The Teamsters filed unfair labor practices charges against the company for unilaterally changing existing and expired contracts, and in February picketed the 2012 Super-Investor Conference in San Francisco where TPG founder David Bonderman was giving the keynote speech.

“Whether we’re dealing with shameful companies or their shady investors” said John Coli, president of Teamsters Joint Council 25 in Chicago. “It’s time to draw a line in the sand and stand up to these financially reckless corporations.”

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