James Briggs

james.briggs@indystar.com

Workers knew something was amiss when the security cameras were installed last weekend.

When Rexnord Corp. began calling its 295 Indianapolis employees into meetings Friday, their worst suspicions were realized. The Milwaukee industrial supplier announced plans to move its west-side bearings plant's operations to Mexico in April.

"They put cameras up last weekend, and they told us it was just for security reasons," said Don Zering, a 43-year Rexnord employee and union president. "We think they lied to us. It was because they knew they were going to close the plant" and wanted surveillance in place.

Union officials learned the news first, starting at 1:30 p.m. Then Rexnord officials told the remaining employees and sent everyone home, clearing the plant. The company cited labor costs.

"He would not take any questions from anybody," Zering said of Tom Kress, the plant's vice president of operations.

Rexnord in a statement confirmed it is "tentatively" planning to move its bearings manufacturing work to Monterrey, Mexico. The move would be completed by June. The company added it has "invited the union to join us in an open and frank discussion over this potential relocation and the impact it would have on Rexnord associates and their families."

Rexnord is at least the third manufacturer this year to signal plans to shift operations from Indiana to Mexico. The company's decision comes eight months after Carrier Corp. said it would shutter its Indianapolis operations by 2019, resulting in 1,400 layoffs. Huntington-based United Technologies Electronic Controls is planning to lay off 700 Indiana workers by 2018 and relocate to Mexico.

Although the Rexnord plant is relatively small, it pays higher wages than Carrier, said Kelly Hugunin, the local union representative for United Steelworkers Local 1999, which represents employees at both companies. The average wage at the Rexnord plant is about $25, Hugunin said. Carrier employees earn between $14 and $25 per hour.

Despite Rexnord's statement that the plant closing is up for negotiation, Hugunin said he expects the company's nearly 300 Indianapolis workers to be the victim of "corporate greed."

"I'm not warm and fuzzy about the thought that we're going to be successful," he said.

Rexnord threatened to close its Indianapolis plant four years ago, Hugunin said. The union responded by agreeing to tiered wages, which paid anyone hired on or after October 2012 a salary of $5 to $6 less than other employees, he said. Rexnord recently agreed to drop the tiered wages in a new contract.

"We had the fear that they gave it back to us because they weren't going to be here — that they'd never have to pay the wages," Hugunin said. "And one way or another, they're probably not. They'll either move or we'll negotiate lower wages."

Rexnord did not make anyone available for an interview.

Rexnord has not yet provided the union with numbers on expected cost savings in Mexico, Hugunin said. Requesting that data will be the first step in determining whether the union can make an offer that would entice Rexnord to stay.

Rexnord, which has a total of 7,700 employees, generated $67.5 million in profit on $1.9 billion in sales in fiscal 2016. That was down from $83.8 million in profit on $2 billion in sales in fiscal 2015. CEO Todd Adams received $1.5 million in total compensation in fiscal 2016, including a $750,000 salary.

In addition to manufacturing industrial mechanical components, Rexnord has a water management business. The Indianapolis plant, at 7601 Rockville Road, makes all types of bearings.

Zering said there were shouts from employees as they learned they'll probably lose their jobs next year.

"I think everybody was shocked," he said. "It's always been in everybody's mind, but we never dreamed it would come like this on a Friday afternoon when we've been working seven days a week."

Call IndyStar reporter James Briggs at (317) 444-6307. Follow him on Twitter: @JamesEBriggs.

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