Venezuelan Workers Occupy Abandoned Clorox Plant

By staff - HR Reporter, September 29, 2014

Disclaimer: The views expressed here are not the official position of the IWW (or even the IWW’s EUC) and do not necessarily represent the views of anyone but the author’s.

VALLES DEL TUY, Venezuela (Reuters) — Hundreds of workers on Friday were occupying two plants belonging to Clorox Co, the U.S. cleaning products maker that has left Venezuela because of the difficult economic conditions.

"We've temporarily occupied the plant because the boss has abandoned it," said Luis Pinango, one of more than 200 workers mounting a round-the-clock vigil at one of Clorox's plants in the Valles del Tuy district to the south of Caracas.

There was a similar situation at the second plant in central Carabobo state, said workers. They were furious at learning they had lost their jobs via a recorded phone message.

In the latest sign of dissatisfaction from private businesses with President Nicolas Maduro's running of the South American OPEC nation's economy, Clorox announced its exit on Monday, saying its business was not viable and that it would sell its assets.

The company said operating restrictions imposed by the government, economic uncertainty and supply disruptions would have led to considerable operating losses. Its share price rose on the announcement, despite the company saying it expected to incur after-tax exit costs of US$60 million to US$65 million, or 46 cents to 50 cents per share, in its fiscal 2015.

Various multinationals, from Colgate-Palmolive Co to Avon Products Inc, have been warning of hits to their balance sheets and scaling back operations in Venezuela, citing Byzantine currency controls and a slowing economy.

Though official GDP data for 2014 is not available, economists say Venezuela is in recession. Annual inflation is more than 60 percent and the complicated multi-layered currency controls make it difficult for importers to access dollars.

Clorox workers are hoping Maduro's government will allow them to take over and run the plants, where boxes of cleaning products and machines could be seen on Friday in evidence of the hasty closure of operations.

"We have enough experience to keep the business going. Most of the workers have been here for more than eight years," said Pinango, whose wife and three children depend on his job.

Government officials have not commented on the case.

Clorox managers in Venezuela have been unavailable for comment, and there was no immediate response to requests for information from the company's U.S. headquarters.

Workers, some holding banners decrying the "illegal closure" and proclaiming "we want to work", said they were bitter at the manner of their dismissal, via a text inviting them to call a telephone number and listen to a pre-recorded message.

"It's the first time a multinational has done anything like that in Venezuela," said Zairo Roman, a machine-repair worker in Carabobo.

Venezuelan analyst Diego Moya-Ocampos, of IHS risk consultancy, said the Clorox case was symptomatic of risks to companies seeking to scale back operations or leave Venezuela.

"Clorox is looking to sell its facilities, but the union seizure risks scaring away potential buyers and could result in property damage," he wrote in an analysis.

"There are several international companies in Venezuela facing the same core problems of rising costs, controlled prices, and the elimination of their profit margins."