$295,000 Backpay Order in Case Where Company Violated NLRA By Creating an Alter Ego Operation

Thursday, January 21, 2016
Former Republic Windows and Doors employees will receive long overdue backpay of $295,000 after a motion from the NLRB’s Region 13 in Chicago was granted by the Bankruptcy Court of the Northern District of Illinois.  In a June 2011 decision, the Board found that the employer violated the National Labor Relations Act when they closed their Goose Island facility and moved operations to an alter ego operation in Iowa. However, ongoing bankruptcy procedures made full or partial compliance with the order unlikely until a successful suit against the employer’s insurer made additional assets available for the repayment of debts.

In December 2008, the employer abruptly shuttered operations at its Goose Island facility and filed for voluntary Chapter 7 bankruptcy resulting in the termination of 270 employees. Simultaneously, the employer established Echo Windows and Doors with substantially identical ownership, management, and purpose. Upon closing operations in the Chicago-area, the employer transferred all bargaining unit work to this alter ego operation in order to avoid obligations to the Union as the employees’ collective-bargaining representative.

Bankruptcy proceedings often prevent compliance with Board-ordered remedies as employer’s assets are liquidated through Chapter 7 processes. While the employees did not receive full backpay, obtaining partial compliance in this case is a victory for workers who have been waiting for a remedy since 2008.
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