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Union sues PepsiCo after Chicago facility closure
A federal lawsuit was filed against PepsiCo after union members said the company violated their rights by abruptly closing a facility in Chicago's Back of the Yards in October.
CHICAGO - PepsiCo was hit with a federal lawsuit after abruptly shutting down a facility in Chicago's Back of the Yards neighborhood last week.
Teamsters Local 727 filed a lawsuit Friday against PepsiCo, alleging the company violated federal labor law by closing the facility located at 650 W 51st Street, laying off hundreds of workers without proper notice.
The union claims PepsiCo violated the Worker Adjustment and Retraining Notification (WARN) Act by failing to provide the required 60-day notice before the plant closure. The union also alleges that PepsiCo failed to include overtime, premium pay, holiday pay, and other benefits in the severance pay calculations mandated by the WARN Act.
PepsiCo notified employees of the closure on Oct. 28. The company said it will pay union employees and continue to provide benefits for 60 days. Employees will not be required to work during those 60 days.
In addition to the WARN Act lawsuit, Teamsters 727 has filed unfair labor practice charges with the National Labor Relations Board, alleging that PepsiCo engaged in bad faith bargaining, retaliation, and failed to provide information to the union.
"PepsiCo's behavior is so egregious it is unimaginable," said John Coli, Jr., Secretary-Treasurer of Teamsters Local 727.
PepsiCo released a statement last week:
"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. 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."
"Not having a production facility just doesn't make sense. It's hard not to believe that this is retaliation for Teamsters members exercising their legal rights," Coli said.
Fox 32 reached out to PepsiCo for comment on the lawsuit.