Flextronics Ordered To Pay $14M To Ex-employees

PARIS — A French industrial tribunal has released a ruling ordering Singapore-based EMS provider Flextronics International Ltd. to pay 11 million euros ($14.8 million) in compensation to former employees on its site of Chateaudun, France. The court ruling considered as "unacceptable" the 166 redundancies that the company made when it closed down the facility in 2008. The industrial tribunal stated that the closure had been decided "without real and serious causes," according to French magazine L'Usine Nouvelle. The ruling carries a provisional order which compels Flextronics to pay, without delay, the sums to its former employees. In practice, each of them should obtain between 20,000 euros ($27,000) and 120,000 euros ($162,000), depending on seniority. Flextronics said it will appeal the decision. In Sept. 2007, Flextronics announced it would close its mobile telecommunication outsourced manufacturing site in Chateaudun before the end of that year or, at the latest, on Jan. 31, 2008, Its main customer, Alcatel-Lucent, had indeed decided to manage these activities internally, and its second customer, Nortel Networks, announced it would transfer its production to Poland. With no more customers, Flextronics Chateaudun said it had no other choice but close its plant. In September of 2006, Flextronics unveiled a restructuring plan with 380 job cuts at its plant in Chateaudun. At that time, Nortel Networks had decided to transfer production of GSM equipment from Flextronics to rival contract manufacturer Sanmina-SCI in Mexico. In parallel, Alcatel intended to move its production of UMTS equipment from the plant. The Chateaudun factory was taken over by Flextronics in January of 2004 as part of a manufacturing agreement with Nortel.