Baker Hughes, A GE Company (NYSE: BHGE), which has dual headquarters in Houston and London, informed employees last month that it plans to stop production at a facility in Lufkin, Texas.
A company spokesperson attributed the decision to the energy downturn.
“The downturn in the oil and gas industry has forced us to review our operations to determine how we can best stay competitive and meet the needs of our customers, changes that are critical to our future success even as we emerge from this volatile environment,” the spokesperson said in an emailed statement. “After careful consideration and evaluation, we have made the difficult decision to stop production at our Buck Creek Rod Lift Systems site in Lufkin, Texas.”
The company will cut about 78 out of approximately 93 manufacturing, sales/services, human resources, sourcing, materials, finance, administrative, IT, EHS and engineering jobs at the Buck Creek facility, according to a letter to the Texas Workforce Commission. The cuts will occur from June 29 to July 13, per the Worker Adjustment and Retraining Notification Act letter, which was recently released by the TWC.
Some of the employees at the facility will transfer to another worksite in Lufkin, per the spokesperson’s statement.
“We are committed to working closely with our respective unions and providing affected employees with resources to help transition to other employment at BHGE or an outside company,” the statement continued.
The facility is a union plant, and employees there have bumping rights pursuant to a collective bargaining agreement with International Association of Machinist and Aerospace Workers (Local 1999) and International Brotherhood of Boilermakers, Iron Ship Builders, Blacksmiths, Forgers, & Helpers (Local 587), per the letter. Bumping rights mean workers with more seniority can take positions held by those with less seniority.
All affected employees will receive wages and benefits for the full 60-day WARN notification period, per the letter. If any employees' jobs are cut before the end of the 60-day period, they will receive payment for wages and benefits-related costs for the remainder of the period in a severance package.
“We know how hard this is for the Lufkin community, so these aren’t decisions we take lightly,” the statement concludes. “For decades, our Lufkin employees have demonstrated expertise and hard work. This decision is in no way a negative reflection of that. We will continue to have a presence in this community, including employing hundreds of workers in our Power Transmission business.”
The Buck Creek facility, about 120 miles north of downtown Houston, was inherited as part of GE Oil & Gas' acquisition of Lufkin Industries LLC. That $3.3 billion deal closed in 2013. GE Oil & Gas then merged with Houston-based Baker Hughes Inc. last summer to become BHGE. In early 2015, 330 jobs were cut at the Buck Creek facility.
