Two local industries have shut down due to the COVID-19 situation.
Both ESCO and La-Z-Boy have closed their doors. ESCO closed down Sunday after an employee tested positive with the novel coronavirus.
According to a press release Monday, the employee has symptoms and is self-isolating at home. Operations at the facility were immediately closed and all co-workers informed. A deep clean of the facility has been undertaken following Center for Disease Control protocols and the foundry is expected to reopen on April 6.
Temperature testing is mandatory before access to the ESCO facility is permitted, and the foundry also had stringent social distancing and hygiene protocols in effect to protect employees.
“Our first priority is always the safety of our people and we’re pleased that our colleague is recovering,” said Travis Wilhelm, site manager. “As an essential business, we are doing all we can to limit the spread of COVID-19 following the best available state and federal advice.”
While La-Z-Boy didn’t have a case as of Sunday, their headquarters decided to shut down all operations nationwide to prevent employees from contracting the disease on the job. This includes the manufacturing and shipping operations in Newton.
The release, which was posted at 5 p.m. Sunday on globalnewswire.com, stated that the company is taking this action to slow the spread of the novel coronavirus “to ensure the well-being of its employees and their families, its customers and the communities where it operates.”
According to the press release, this shutdown will result in the furlough of approximately 6,800 employees, or approximately 70 percent of its global workforce. A salary reduction of 50 percent for senior management and 25 percent for salaried employees will be in effect until further notice.
Kurt L. Darrow, Chairman, President and Chief Executive Officer, of La-Z-Boy Incorporated, said keeping employees, customers and the communities safe and healthy is of “paramount” importance.
“Throughout this period, La-Z-Boy has followed all government regulations and recommendations and implemented best-practice health and safety protocols,” Darrow said. “At this time, the company is not aware of any confirmed coronavirus cases across the enterprise and will continue our efforts to keep facilities clean and safe. However, our leadership team has determined that more significant measures are necessary to protect the health and safety of our employees, and to assist in the national effort to combat the spread of COVID-19. We will continue to assess the evolving situation to determine the cadence to re-start operations and open stores.
“While the decisions made were extremely difficult and we deeply regret the impact they will have on those affected and their families, they are deemed necessary as we face one of the most challenging periods in our history. Moving forward, with a strong financial foundation, the powerful La-Z-Boy brand, and our dedicated and hard-working people, I am confident the company will weather this storm. Although the path forward will likely be complex and unpredictable, we expect to return to full operations when the crisis lifts, and emerge with strength.”
In addition to the closure of its manufacturing operations, it will have a temporary closure of all company-owned stores is in process.
During this time, customers may still make purchases at La-Z-Boy.com and Joybird.com. Those orders will be delivered when operations resume.
In addition to these cuts to employees, La-Z-Boy is making other moves to help the company survive the shutdown. The company’s board of directors will forego the cash portion of its compensation until further notice. The company’s 401(k) match program will be frozen.
The company also eliminated all non-essential operating expenses and capital expenditures along with eliminating June quarterly dividend and termination of the share repurchase program indefinitely to prioritize near-term financial flexibility.
In addition to almost $200 million in cash, cash equivalents, restricted cash, and investments on hand, to strengthen its financial position and preserve liquidity, the company has proactively drawn $75 million under its $150 million revolving credit facility.
The company plans to report its fiscal 2020 fourth-quarter and full-year results in the second half of June, and will update the investment community with more details on its various initiatives at that time.
“Until that time, the company undertakes no obligation to update the investment community,” the press release stated.
Delta Directional
Delta Directional’s operations are continuing despite their offices in Newton being closed.
General Manager Colt Cleveland said they made the decision for anyone who worked in the offices to work about two weeks ago. Their office staff has been working from home ever since. Only essential personnel are going into the office, but Cleveland said they are practicing social distancing if there is more than one person working in the office.
“It has been an adjustment working from home,” Cleveland said. “I think we have been focusing primarily on our communication. Maybe, we have been overcommunicating a little bit, but I think it’s something that may actually help us in the long run.”
As far as their workers out in the field, Cleveland said their workers are usually not around many other people, but when they are, they are using best social distancing practices. While there has been a slowdown in the energy sector, he said they are still seeing a high demand for fiber and increased internet access.
“With so many of us working from home, it has shown the need for better internet access, especially in rural areas,” Cleveland said. “So we are seeing a demand in providing high speed internet access.”
Delta Directional’s employment fluctuates around 230 employees depending on the season.
Biewer Sawmill
Biewer Sawmill is still operating under a normal work schedule. Plant manager Jason Otto said they are following all of the recommended guidelines to prevent exposure to the coronavirus.
“Biewer Sawmill is running normally while taking advanced precautions to limit coronavirus exposure to our employees,” Otto said Monday. “We are following all CDC and Federal OSHA Coronavirus recommended precautions for businesses at this time.”
