The Uniformed Services Employment and Reemployment Rights Act of 1994 (USERRA) provides employment and reemployment rights to all uniformed service members. These rights extend to persons who have been absent from a position of employment because of "service in the uniformed services," such as the performance of duty on a voluntary or involuntary basis in a uniformed service, including active duty; active duty for training; initial active duty for training; inactive duty training; full-time National Guard duty; absence from work for an examination to determine a person's fitness for the above types of duty and funeral honors duty performed by National Guard or reserve members.
USERRA rights cover the cumulative length of time that an individual may be absent from work for military duty and retain their reemployment rights for five years. USERRA provides that returning service-members are reemployed in the job that they would have attained had they not been absent for military service (the long-standing "escalator" principle), with the same seniority, status and pay, as well as other rights and benefits, determined by seniority. However, USERRA also requires that reasonable efforts (such as training or retraining) be made to enable returning service members to refresh or upgrade their skills to help them qualify for reemployment. The law clearly provides for alternative reemployment positions if the service member cannot qualify for the "escalator" position. USERRA also reaffirms and clarifies that while an individual is performing military service, he or she is deemed to be on a furlough or leave of absence and is entitled to the non-seniority rights accorded other individuals on non-military leaves of absence.
Reemployed service members are entitled to the seniority and all rights and benefits based on seniority that they would have attained with reasonable certainty had they remained continuously employed. Departing service members must be treated as if they are on a leave of absence. Consequently, while they are away, they must be entitled to participate in any rights and benefits not based on seniority that are available to employees on nonmilitary leaves of absence, whether paid or unpaid.
If there is a variation among different types of nonmilitary leaves of absence, the most favorable treatment must be accorded the service member. The returning employees shall be entitled not only to non-seniority rights and benefits available at the time they left for military service, but also those that became effective during their service. Service members may be required to pay the employee cost, if any, of any funded benefit to the extent that other employees on leave of absence would be required to pay.
If, prior to leaving for military service, an employee knowingly provides clear written notice of an intent not to return to work after military service, the employee waives entitlement to leave-of-absence rights and benefits not based on seniority. The employee must be made aware of the specific rights and benefits to be lost. Notices of intent cannot waive other rights and benefits that a person would be entitled to under the law, particularly reemployment rights.
Pension plans, which are tied to seniority, are given separate, detailed treatment under the law. If a person has been absent for military service for 91 or more days, an employer may delay making retroactive pension contributions until the person submits satisfactory documentation. Contributions will still have to be made for persons who are absent for 90 or fewer days.
Service members must, at their request, be permitted to use any vacation that had accrued before the beginning of their military service instead of only being allowed to take unpaid leave. However, it continues to be the law that service members cannot be forced to use vacation time for military service.
The law provides for health benefit continuation for persons who are absent from work to serve in the military, even when their employers are not covered by COBRA. (Employers with fewer than 20 employees are exempt from COBRA.) If a person's health plan coverage would terminate because of an absence due to military service, the person may elect to continue the coverage for up to 18 months after the absence begins or for the period of service (plus the time allowed to apply for reemployment), whichever period is shorter. The person cannot be required to pay more than 102 percent of the full premium for the coverage. If the military service was for 30 or fewer days, the person cannot be required to pay more than the normal employee share of any premium. A waiting period or exclusion cannot be imposed upon reinstatement if health coverage would have been provided to a person had the person not been absent for military service.
Under ordinary circumstances, a worker becomes eligible for leave under the Family and Medical Leave Act (FMLA) after working for a covered employer for at least 12 months, during which he or she completed at least 1,250 hours of work. A member of the National Guard or Reserve who is absent from employment for an extended period of time due to military service and who requests FMLA leave shortly after returning to civilian employment may not have actually worked for his or her employer for a total of 12 months or may not have performed 1250 hours of actual work with the employer in the 12 months prior to the start of the FMLA leave. To determine their eligibility for FMLA, employers must give the reemployed person credit for any months he or she would have been employed but for the military service. It should be noted that the 12 months of employment doe not have to be consecutive to meet this FMLA requirement.
The USERRA Advisor on the Department of Labor website (dol.gov) helps veterans and employers understand employee eligibility and job entitlements, employer obligations, benefits and remedies under the Act. Veterans' Employment and Training Service (VETS) has also published a non-technical USERRA Guide that contains general information about the law. Information on USERRA and other VETS programs may be found at www.dol.gov/vets.
Peter Perez of Carter Products in Grand Rapids, MI has the ear of Senator Debbie Stabenow (D-MI). Through personal contact over the last several months, Mr. Perez has been able to convey to the Senator the severity of the state of manufacturing in Grand Rapids and throughout the U.S. The passage of this Bill on May 11th is a victory for manufacturing and for WMMA®. To read the complete press release, click here.
You, too, can get involved in the legislative process in so many ways. Your membership in WMMA® is just one. WMMA®, as an Association, is a member of NAM, and we attempt to forward you as much NAM information as possible. But each WMMA® member company can and should join NAM (www.NAM.org) now, more than ever.
As an individual company, you are also encouraged to do the following, TODAY!:
The NAM wants to provide you with the opportunity to learn about radio frequency identification (RFID) technology and how quickly you and your industry may be influenced by it. As part of this ongoing effort, NAM is co-sponsoring a conference with RFID Operations magazine and the Government Contracting Institute on June 9-11, 2004, in Washington, D.C.
The conference, RFID 2004: New Rules of the Game, brings together expert practitioners straight from the trenches, including RFID policy leaders from Wal-Mart and the Department of Defense. This conference will give you insight on forming your RFID team, considering the right implementation strategy, investing in flexible, upgradeable technology, integrating RFID to improve your entire logistics operation, and more. NAM members and members of NAM allied associations are entitled to a $300 VIP discount-that's 25 percent off the registration fee!
To register, go to www.RFID2004.com, or call (1-800) 260-1545. Be sure to use the discount code: NAMVIP. You can also contact Dan Akman at (202) 637-3196 for more information.
To view a flyer on the Conference, click here.
By Art Raymond, A.G. Raymond & Co., Inc. (araymond@raymondnet.com)
A steady drumbeat of stories about jobs has recently commanded the newspaper headlines and evening news broadcasts. Politicians, economists, and talking heads alike cannot explain the failure of a growing economy to generate employment. Blame is placed on President Bush and U.S. corporations seeking "obscene profits". Next in line must surely be golfer Tiger Woods who employs a caddy from New Zealand.
For at least 70 years people have predicted the disappearance of jobs and the death of the U.S. economy. In 1932 President Hoover called for "the speeding up of social invention or the slowing down of mechanical inventions" to prevent "grave maladjustments". President Kennedy belied his faith in technology and the space program with his comment that automation "carries the dark menace of industrial dislocation, increases unemployment, and deepens poverty". And of course we all remember Ross Perot's "giant sucking sound of jobs being pulled out of this country". Yet since Hoover employment and living standards have quadrupled. Will the future be any different?
The culprit-du-jour for our supposed job woes is outsourcing. CNN on its nightly business program bashes executives who move work to lower-cost countries. The fact is, however, we live in a global village connected by the relatively open flow of ideas, capital, and products better known as free trade. And free trade has historically brought outsourcing and insourcing. In a recent Wall Street Journal op-ed Walter Wriston, former chairman of Citicorp/Citibank, noted that the number of jobs we import from abroad greatly exceeds the jobs we export. Last year, for example, Honda increased its production in the U.S. by 15%. Novartis, the drug giant, is moving its world-wide R & D operation from Switzerland to Massachusetts. Samsung is building a $500 million semiconductor plant in Texas. These companies are benefiting from proximity to our huge market, superior labor productivity, and stable political environment. Such investments resulted in the creation of 6.4 million jobs in 2001 with 34% of these positions in manufacturing. Workers in the industrial heartland of America - Ohio, Michigan, and Indiana - have benefited heavily from this inflow. And importantly, 22% of the products of these U.S.-based foreign companies are exported.
To inform the current outsourcing debate, the Information Technology Association studied the effects of outsourcing on computer services jobs. Their research concluded that the higher overall productivity resulting from outsourcing generated 90,000 U.S. jobs in 2003 and will create 317,000 new jobs in 2008.
Most importantly, the U.S. is not running out of jobs. The problem is predicting with certainty what the future holds for individual workers and firms. No doubt employment in the U.S. in this future will require new skill sets comprised primarily of specialized knowledge rather than rote, sweat, and muscle. Relatively simple jobs that can be reduced to a series of decision rules are most likely to disappear overseas or be replaced with technology. Jobs requiring personal contact and/or special analytical skills will however be in high demand.
It's worth repeating the Economic Factoid from last December's Business Briefing - A quarter of all U.S. workers are now employed in jobs that were not listed in the Census Bureau's 1967 occupation codes. Jobs lost since then were simply replaced by jobs no one could imagine. Therein lies the problem. Predicting the training and education needs for jobs yet defined is difficult at best. The future is uncertain. This uncertainty naturally brings concern especially for those caught in the transition from today's economy to the future.
Economic Factoid - Today's 5.7% unemployment rate is just above March 1964's 5.4%. Kennedy's specter of a "dark menace of industrial dislocation" proved unfounded. His fears, however, resulted in significant lowering of taxes to stimulate business investment and personal consumption, a move similar to last years' Bush tax cuts.
In all businesses and particularly in manufacturing, we do have problems to overcome. Health care costs, tort litigation, and heavy regulation decrease U.S. producers' competitiveness. Health care costs rose by 14% in 2003. Workers' comp premiums are also rising. Even with a slack labor market, labor costs are rising faster than inflation. In 2003 compensation costs increased 3.9% compared with only a 2.3% gain in consumer prices. Since wages and salaries are typically inelastic, the only way companies can lower labor costs is to fire workers and raise productivity of those remaining. Only when employers must absolutely crank up output will new workers be hired.
And such hiring may just be kicking in. In March the economy added 308,000 new jobs. Significant gains were reported in construction, retail, health care, and business services.
Bottom Line: Keep the faith. The U.S. is enduring an economic transition of global proportions with no clear vision of the future. The future rests with cutting edge innovation and the ensuing flood of yet-to-be known products and services. The job-making machine that is the U.S. economy will once again save the day.
Office Furniture - BIFMA reported that February 2004 shipments increased by 2% year-over-year vs. the same month last year while new orders were flat. Analysts, while disappointed in this performance given the easy comparison with the prior two years, are now calling the outlook for this sector positive as the drivers of office furniture spending, employment and corporate profits, improve. Remember this sector saw its sales decline from a $13.3 billion annual rate in January 2001 to $8.5 billion in November of 2003.
Kitchen Cabinets - Cabinet sales continued red hot by growing a torrid 17.6% in February vs. the same month in 2002 according to the KCMA's Trend of Business Survey. Year-to-date 2004 cabinet sales were up 17.8%. The KCMA is forecasting a 12% rise in cabinet sales for the full year. Remember that last year's cabinet sales rose 13.1% following on 10.9% growth in 2001 and 12.4% in 2002.
Producers continue to add more cabinet configurations, options, and accessories to give the consumer more choice. More finish selections - colors, glazes, sand-through, and distressing - also provide opportunities for customization as cabinetmakers offer fuller, more furniture-like looks.
Profit margins continue healthy industry wide, a situation that has somewhat dampened the move to outsource doors and other wood components. Cabinet companies appear unwilling to risk the competitive edges of fast delivery, high quality, and customization to save a few cents on purchased part.
American Woodmark, the second largest U.S. cabinetmaker, reported sales growth of 19% for its 3Q2004. Gross margin fell to 20.8% vs. 22.2% last year. Management blamed the decline on higher lumber and particleboard costs as well as increases in employee benefit expenses. Operating margin also declined, falling to 7.7% from 8.3%.
Home Furniture - The industry continues to await the Department of Commerce's ruling on the anti-dumping petition against Chinese bedroom furniture producers. In late March the DOC announced the selection of India as the surrogate country for purposes of valuing the factors of production. In assessing whether Chinese producers are selling below cost, the DOC must determine the cost of furniture production in China. Because China is a non-market economy under petition rules, the DOC must construct values for wood bedroom furniture using costs from an economy with similar characteristics to China. In almost all anti-dumping cases involving China, the DOC has selected India as the surrogate. The effects of this choice on the petition's outcome are unclear. However, several petition opponents including Furniture Brands International and two large Chinese producers argued in favor of Indonesia as the surrogate. Indonesia is the largest producer of wood bedroom furniture in the group of potential surrogates considered by the DOC.
The real issue is control of the $65 billion U.S. furniture industry. Will U.S. producers retain a place in the furniture value chain or be disintermediated by U.S. retailers' direct purchases of Chinese products? Without the imposition of heavy duties, an outcome that will hurt the U.S. consumer and perhaps furniture sales, the economics of production in China will win out. Stay tuned.
At the producer level…A Chapter 11 bankruptcy filing by Bush Industries on March 30 was the biggest sector news. The RTA furniture maker cited its inability to secure alternative financing sources as the primary reason for the filing. Management intends to refinance $70 million of its senior debt and convert $90 million into equity of the reorganized company. The RTA sector has seen its growth flatten over recent years. In addition the bankruptcy of Kmart and smaller mass merchants hammered the industry's balance sheets. Bush's attempts to diversify from its core furniture business have also proven unsuccessful.
Casegoods maker Stanley Furniture forecasted an 11-13% gain in 1Q2004 sales. Imported product now accounts for about 30% of sales vs. last year's 20%. However capacity utilization of its domestic plants has improved to 70-75% since year end.
Hooker Furniture announced a 5% sales increase in its 1Q2004. The company has turned in nine consecutive quarters of increased sales. This growth was fueled by an 11% increase in shipments of imported products. On the negative side, lower demand for domestically-produced wood furniture resulted in low capacity utilization. Operating margin for the quarter was 8.7%.
Integrated manufacturer/retailer Bassett Furniture reported a 1.3% decline in 1Q2004 sales as the company continued to shift sales from independent retailers like JC Penney to its Bassett Furniture Direct (BFD) stores. Shipments to the BFD channel were up 11% year-on-year. As with most U.S. producers of wood furniture, the company continues to struggle with the profitability of its Wood Division plants.
Wood Flooring - February shipments of strip flooring were up 9% over 2003. For the first two months of 2204 shipments increased by 11% as wood flooring continued to benefit from the strength in new home construction and remodeling. Healthier log supplies at sawmills should translate into lower lumber costs as the supply of low-grade oak, the raw material of choice, improves.
Non-Residential Construction - The office construction sector is strengthening. A survey by CB Richard Ellis, a major commercial property brokerage, found the national office vacancy rate fell from 16.8% to 15.6% in 4Q2003. For the same period the U.S. Census Bureau reported that spending on office construction increased 4.2%, the second quarter-to-quarter gain after nine quarters of steep declines. While office construction spending is up only 6% from its low early last year, experts are forecasting a rise of 10% this year and 13% in 2005.
Expanding demand from aging Baby Boomers plus replacement needs are driving higher spending in healthcare construction. Coming off gains of 17.4% in 2002 and 7.9% in 2004, this sector is forecasted to grow another 9.3% this year.
By Harold Zassenhaus, WMMA® Export Director, zemg@erols.com
Wood Furniture import statistics have been broken down into 11 component parts: bedroom furniture, wood frame upholstered furniture, chairs, furniture parts, office furniture, kitchen cabinets, furniture and parts of rattan, cane or bamboo, chair parts, kitchen furniture (excluding cabinets), furniture for vehicles and other wood furniture. Members can click here (Jean/Brian: insert link) to view a series of tables showing 3-6 year trends by type, by country and imports from China. Members will need their user name and password to log onto the site. Contact Karen Boyle, WMMA® Headquarters, (215) 564-3484, for forgotten user name and password.
Wood furniture imports topped $12 billion in 2003, growing 11.5% over 2002. Wood frame upholstered furniture and bedroom furniture continued to be the fastest growing segments, increasing 22% and 18%, respectively.
Imports from China continued to increase by more than twice the average, growing by 26% to $4.8 billion. Other than the basket category of "other wood furniture" the largest types of furniture imported from China were bedrooms, upholstered furniture and chairs. Shipments of bedroom furniture increased 42% to reach $1.1 billion. Although some of the increase could have resulted from the countervailing duty rate petition by a group of US furniture manufacturers, most of the growth likely was the result of increased demand and continued outsourcing by US furniture producers. Although kitchen cabinet imports are still rather small ($56 million), they grew an impressive 48% over 2002.
Total wood furniture imports increased by $1.3 billion in 2003 and imports from China increased $983 million. It would be superficial to directly link the two figures and state that over 75% of the increase in US demand was satisfied by Chinese produced wood furniture. However, it is no understatement that China is having a profound effect on the US woodworking industry and the industry's suppliers. The combination of China's low labor costs, significant and increasing flows of foreign capital, local incentives, a lax banking system and an undervalued currency make for a potent brew for manufacturing and exporting wood products and capturing US market share. The importance of traditional suppliers such as Italy, Canada and even Indonesia, Malaysia and Thailand is decreasing in the face of China's advantage.
Nonetheless, or perhaps because the US wood furniture market is increasing, other supplier nations are carving out and/or increasing their niche in the US. The fastest growing suppliers (i.e., 2003 imports were more than $10 million and country import growth rate was greater than the average for all nations) included:
H. Zassenhaus is available to provide additional data. There is no charge for WMMA® members. Contact him at 301 652 0693 or email zemg@erols.com
AWFS® and WMMA® once again will be awarding up to 24 foreign representatives and users of woodworking equipment and/or furnishings supplies $1,500 each to visit IWF August 26-29, 2004 in Atlanta to meet with member firms. A joint screening committee will select the most qualified nominees from a pool of candidates submitted by AWFS® and WMMA® members.
We Need You! Nominate a favorite dealer who is looking for U.S. lines or a buyer with a short list that not only includes your equipment but possibly that of your colleagues. Strengthen your relationship by increasing face time and giving him the funds to see you. Help your colleagues by exposing them to strong and qualified dealers and buyers.
Each member company can nominate up to three representatives handling their lines in other countries or potential buyers interested in your equipment. (You do not need to be an IWF exhibitor to participate.) Click here http://www.wmma.org/members/secureDocument.cfm?docID=89 for a nomination form.
"This is a really great program for Central and South American countries because USA companies can sell technology and new products to Latin Countries. It is great for us (Mexicans) to show Americans that we are serious trading partners. Of course we help each other." - Gabriel Moreno of Showmark, Mexico
Plenty of Chances to Meet with Top Notch Foreign Dealers and Buyers!
WMMA® and AWFS® are arranging a number of opportunities for you to meet the selected recipients:
"Mikron is definitely in a better position because of this program." - Lynn Arbuthnot, Mikron Woodworking
"[We] established a new dealer in Mexico City and made contacts with other potential dealers." - Tom Orlando, CTD Machines
Don't delay! A joint committee will be reviewing nominations based on the date received. Awards are given in two stages: the first on April 21st and the second in late May or early June. We want to be sure to give the foreign buyers and members plenty of time to exchange information and arrange their schedules.
If you have questions contact:
Harold Zassenhaus, WMMA® Export Director at
tel: 301 652 0693;
fax: 301 986 1389,
Email: zemg@erols.com
or
Anna Druk, AWFS® International Relations Coordinator at
tel: 818 879 8813;
fax: 818 879 8815,
Email: ADruk@aol.com
2004 WIC Workshop speaker Tim Longwell of D.J. Case & Associates is pleased to announce the launch of a website with the resources developed for the Hispanic Woodworker project: http://www.djcase.com/hispanic/. The site offers company information resources that can help improve communications and information exchange
Obstacles, current training needs, and optimal delivery methods of information were identified through an assessment of participating companies and Hispanic workers in the wood products industry in late 2002 and early 2003. Based upon the results of this assessment, several specific products were identified for development.
These products are company information resources that can help improve communications and information exchange. There products include:
All of the products can be found at http://www.djcase.com/hispanic/
These are now being pilot tested to allow developers to modify them to best meet your needs. Please complete the evaluation for each resource to give feedback on the usefulness of these tools. Your honest evaluation of these materials will help developers improve them for you and your workers.
We are asking that users complete the evaluations prior to June 1st 2004. At that time we will modify the resources to best meet the needs of the woodworking industry. Once these changes are made the products will be formally delivered to the Wood Education and Resource Center in August 2004 and the website will be hosted on a U. S. Forest Service server. The "new and improved" products will continue to be available to you free of charge.
Check your desk for forms to update your company listing for the printing of the NEW 2005 WMMA® Buyers' Guide & Directory! The new Directory will debut at IWF this August in Atlanta, GA. Now is the time to make sure that your listing is high impact and memorable!
Your form must be returned to WMMA® Headquarters by May 28th. If we do not hear from you by May 28th, we will print the information your company supplied the 2003 Buyer's Guide & Directory.
The information we currently have on file for your company was mailed to you weeks ago. If you need an additional copy faxed to your attention, please call Peter Michener, 215-564-3484 x248.
Fax your updates to 215-963-9785. The deadline for returning materials is May 28, 2004
Carter Products Celebrating 75 Years Of Production Enhancements And Innovations The start of the Great Depression was a particularly difficult time to found a new company. However, regardless of the economic conditions of the time, Andy Carter had an idea to improve the productivity of band saws, and he formed Carter Products, Inc. From the first band saw wheel with replaceable tires, to their latest innovations for both the hobbyist and industrial woodworker, Carter Products has now brought new ideas to life for 75 years.
Carter Products holds dozens of patents on band saw guides and stabilizers. They were the first company to understand the importance of guide line lights to increase accuracy in all types of industrial cutting applications. They now market the broadest range of industrial line lasers and 2D projection laser systems in the world. Their innovative, Flip-Pod® vacuum system to position and hold parts for CNC machining won the coveted Challengers Award for new technology at the International Woodworking Fair. Their Inspecto- Light system continues to lead the industry by providing instant feedback on surface defects in panels before expensive finishing operations take place.
Most recently, Carter has introduced the Quick Release TM Band Saw Tension Toggle that helps extend blade life and increases the speed and safety of blade changes. They have also added their Sander Setup/Diagnostic Gauge that helps operators calibrate widebelt sanders with greater accuracy, thereby increasing product quality and sanding belt life. For more information on these products, or any other Carter innovation, contact: Carter Products Company, Inc., 2871 Northridge Dr. NW, Grand Rapids, MI 49544. Toll-Free: 888-622- 7837. Phone: 616-647-3380 Fax: 616-647-3387. E-Mail: sales@carterproducts.com. Web: www.carterproducts.com.
Midwest Group One, combining the resources of Midwest Automation, Midwest Sandright, ORMA-Midwest, OMMA Srl, and Casadei Macchine, is pleased to announce a new 3,500 square foot Tech Center located in their Minneapolis, Minnesota facility. Click here for more details.
This year marks the 20th anniversary for CNC Software, Inc. Incorporated in 1984 by two brothers, Mark and Jack Summers, CNC software is a longstanding pioneer in the PC-based CAD/CAM industry. Click here for more details.
If you have colleagues who should be receiving this newsletter notification, or if you have received this notification in error, please email jconey@fernley.com.
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