Pepsi closes only Chicago plant without warning employees, union alleges

Pepsi shuttered its South Side plant without notice Monday morning and laid off at least 79 employees.

Workers showed up at the plant as usual early Monday only to learn they had been let go and the facility would be closed, according to their union, Teamsters Local 727. They were sent home at 5:45 a.m., and deliveries to the plant, at 650 W. 51st St. in Back of the Yards, were being rerouted shortly after, according to a union spokesperson.

Chicago police officers were at the Pepsi plant Monday morning to escort laid-off employees off the premises, union spokesperson Caleen Carter-Patton told the Sun-Times.

The employees will receive pay and benefits for 60 days until Dec. 28, according to a letter Pepsi sent to employees and union representatives. At that date, the facility will also be officially closed.

The union alleges the lack of notice violates the state's Worker Adjustment and Retraining Notification Act. Instead of a WARN notice, the company is paying the employees and supplying benefits under their collective bargaining agreement for 60 days, and employees are not required to work.

The letter from Pepsi says 79 employees are laid off. However, 150 people are employed at the facility, a union spokesperson told the Sun-Times. It's not clear what will happen to the other 71.

"We've been left in the dark," Carter-Patton said. "There was no warning or notice before today."

The WARN Act requires employers with 75 or more full-time employees to provide 60 days notice of pending plant closures or mass layoffs. Companies can avoid that by instead providing 60 days of pay before the employees are let go. The state's website that tracks WARN notices did not have the Pepsi layoffs listed as of noon Monday.

Some employees were tipped off Sunday that something was happening. Police officers who know employees at the plant had called them Sunday to ask why they were being asked to come to the plant, Carter-Patton said.

"The decision to no longer operate at 51st Street is a difficult one. This is a more than 60-year-old building that has physical limitations," Pepsico said in an emailed statement. "Our top priority is to support our employees during this transition, and our commitment to serve Chicagoland remains strong. Our plans meet applicable legal requirements, and we will actively work with union leadership on the details related to the closure."

John Coli Jr., Teamsters 727 secretary-treasurer, blasted Pepsico over the plant closing.

“That Pepsi would do this to their longtime employees is disgusting. They are a disgrace,” Coli said in an emailed statement. “To lay off over a hundred Teamsters workers with no notice to them or the union, in violation of both our collective bargaining agreement and the law, is about as low as you can get."

Coli said the plant is the only remaining Pepsi production plant in the Chicago area. The union wrapped up negotiations with the company earlier this summer and had no indication that layoffs were coming, he said.

“Our members aren’t stupid. They see the news. Pepsi is making money hand over fist," Coli said. "On top of everything else, the holiday season is beginning. I truly cannot put into words how despicable this is.

“The union will do everything in its power to ensure that these employees are taken care of per the union contract and the law.”