QUESTIONS YOU MAY HAVE

The following questions have been asked by employees since December 12, 2008. Earlier questions and answers are posted below this new posting. If your exact question does not appear, it has been combined with other similar questions or it required a personal response. Thank you for your participation.  After reading these questions and answers, you can submit new questions here.

July 7, 2009

1. Looking at the current business, will there be any plans to layoff employees in the fall? I heard there will be layoffs in September.
   
   There are no concrete plans about employee layoffs in the fall for our Schofield factories. In May and June we brought back nearly 100 laid off employees as vacation relief. They were all told that once the vacation season is over and depending upon the order intake volumes, that some or all of them could be laid-off later this year. While we have been able to come close to our intake budget for the first quarter, thanks to the excellent team efforts by all employees and our sales reps, there is no guarantee that this will continue. In fact, nationally, commercial construction starts are at half of what they were at this time in 2008. So, while there are no definite plans or decisions for fall layoffs, it is a possibility.
   
   
2. Does the company look at employees' past records to determine which employees to call back? There are some lazy employees that are called back that we believe are not even worth being called back.
   
   Per our labor agreement in Schofield, most individuals are called back according to seniority, unless they possess a unique skill, such as welding. In that case we can call back out of the normal seniority sequence. Other than for skill reasons we are not able to look at issues such as performance when doing a call back.

June 30, 2009

1. For office employees who took a complete week off, how is the United Way contribution and Flex deductions effected? And any insurance deductions?
   
   United Way contributions, Flex deductions and Insurance deductions are all flat dollar amounts so they are not dependent on the number of hours an employee is compensated for. Therefore, these deductions will not change during the week in which an office employee chooses to take their unpaid week. The only deduction that will change is for 401(k), as this deduction is directly tied to the amount of compensation paid on any given pay check.

June 16, 2009

1. Are you going to give the Union a list of those called back for summer help? Those who weren't called back still wonder how close they came.
   
   The recall list can be found on the union web site www.smwialocal565.org.
   
   
2. With the company budget being as tight as we are told, how can the big screen TVs, that are starting to appear in some plants, be justified? Do they improve productivity? Are top of the line models needed? With this in mind, why are some basic maintenance requests denied because of tight budgets?
   
   Greenheck has had to make some unpopular decisions in the last six months, all to ensure the company stays in the game. With all the budget cuts, cutting of security, layoffs, many of us shop personnel would like to know why someone in management gave the "OK" to tens of thousands of dollars in flat screen televisions to be hung around the Plant 3 fab areas. At a time like this, wouldn't that be considered wasteful spending??
   
   Why would someone think that hanging a bunch of expensive televisions in the shop is a good idea? By the skybox in plant three is one of the most outdated bathrooms in the plant, and it won't even get a coat of paint because maintenance is busy hanging flat screen TVs. With those monitors everywhere, people can see what their rates are and stop when they hit a percentage they like, instead of just working steady through the day. The people that are left are not newcomers, and know what it takes to get by.
   
   The monitors are being used to display GRT or Greenheck Real Time. They are connected to a combination of systems to establish various operational expectations and provide real time or immediate feedback to answer the question: "How are we doing?" The intent is to give all employees involved with the production process (Supervision, Engineering, Support personnel and Factory Employees) a real time operational measurement or scorecard. Knowing how we're doing on a continual basis enables us to quickly identify and fix problems that may arise (part shortages, equipment breakdowns, or other performance issues). The information displayed on the monitors was designed to be easily understood at a glance which eliminates information deficits that lead to wasteful time and motion. Greenheck is committed to becoming Leaner as we encounter a more competitive marketplace and this project is a component of the Visual Workplace lean principle. Greenheck Real Time performance feedback, coupled with other Visual Workplace elements like organized work benches, standard work instructions, and specific locations for all materials help us become more productive.
   
   The specific monitors were chosen for durability and longevity and are not the highest end available. Greenheck did get a substantial discount which assisted us in justifying this project. With the implementation of this project the only external resource that was utilized was the purchase of the monitors. Outside of the monitors everything was purchased/completed in house. We used existing SAP technology that was previously purchased and not using it would be a waste of previously spent dollars. The cost of this capital project was approximately 1/2% of our FY10 capital spending and was justified through the anticipated productivity increases. The productivity increases boosts bottom-line profits and maintains a sustainable competitive edge in the marketplace for Greenheck.
   
   
3. When and where can a person sign up for the non-smoker discount if they have reached their 12-month mark?
   
   Congratulations on staying smoke-free for 12 months! The form you need to sign is available in the HR department. Please sign the form prior to June 15th in order to have your smoker's surcharged removed effective July 1.
   
   
4. If the company is looking for ways to cut costs, maybe someone should investigate why Shipping is bringing 11 people in on first shift for overtime when there is nothing to do. This seems like a real waste.
   
   Overtime decisions in Shipping are based on five factors: vacation schedules, the work that is currently in the department, the work that is anticipated to come into the department, the promised ship dates on the work that is in the department, and the time of the month. The hardest factor to determine is what will come into the department from the time the decision is made through the time the overtime is worked. If orders do not generate as anticipated, the work may not be as heavy as thought. We may also error on the side of bringing a few more people in, at times, to ensure our customers' needs are met. However, it is not possible to bring in 11 people for overtime on first shift as we do not have the equipment to support this.
   
   
5. As for the jean day-day could they have a sign up sheet at the front of all the plants where you could put your clock number and have it payroll deducted; it would be easier for us on the off shift to help, thank you.
   
   Sorry, but payroll deduction will not be made available for the Jean Day fee.
   
   
6. Rumor has it that there might be a total plant shut down for the week of the fourth of July. Is there any truth to this rumor and how soon will we know for sure of the shut down?
   
   There is no truth whatsoever to this rumor.
   
   
7. Why doesn't Greenheck care about family values or worker moral anymore? Why can't Plt.2 work overtime early on days like other plants do? It seems to me that there is plenty of room for some people to do that. Saying that people will complain if they can't because of room doesn't hold water. Worker moral is very low because of this! To me I would want the regular workers doing the job.
   
   Why can't plant 2 work overtime early when it's being done company-wide? It seems like management is trying to kill moral.
   
   Currently we are running large crews on 3rd and 1st shift, which creates fewer openings to overlap overtime between those shifts. In most fabrication areas and some assembly areas especially the ones asking for overtime we are at or near capacity on 3rd shift. Add in that anytime we have an available person on 3rd we will typically move them to where we are running overtime limiting the openings. With 2nd shift being our smallest shift we have capacity in all but a few areas to allow volunteers to work overtime. With that said we are running 1st shift overtime late and 3rd shift overtime early. In the areas where we are at capacity on all three shifts, we are running overtime on Saturday when needed.
   
   As you may have noticed, we have also been calling back employees from layoff. This will help cover the summer vacations and reduce the amount of overtime needed.
   
   
8. I heard that the summer call back help included welders that were called back without regard to their seniority on the call back list. When Greenheck does begin calling workers back on a full time permanent basis, will welders get preferential status like they did during the layoffs, or will strict seniority be observed?
   
   The union contract allows the company to bypass employees from layoff and recall out of seniority based upon skill. Welders were exempted from layoff and recalled out of seniority because of order demand in factories that require a high level of weld and the investment we have made in hiring and training for this skill. The number of welders bypassed in the layoff process and recalled out of seniority was determined based upon forecasted production needs, allowing us to meet customer demands. We will continue to follow this practice if the production needs warrant it.
   
   
9. Will there be any more workers called back?
   
   Greenheck will be recalling approximately 14 shop employees in Wisconsin on June 22.
   
   
10. There is too much internet abuse in the office. Something needs to be done, we are too lax as a company, people are sending personal emails all day long. We need productivity in all areas!
    
    Greenheck has an internet use policy and all employees will be reminded once again of the policy. Our IT department has the ability to monitor usage and abusers will be investigated.

May 22, 2009

1. Would it be a savings for Greenheck to offer e-statements to those who have their entire check direct deposited, instead of sending out check statements in the mail?  I know I would be just as happy with an e-mail copy of my statement and it would not cost any postage, paper or printing.  Would also be environmentally friendly.  Can employees have the option to go paperless?
   
   We concur that this is an excellent idea.  Unfortunately, our current payroll system was deployed in 1999 and was probably written in the mid-90's. It does not have the capability of producing an electronic check stub to post to an individual's e-mail account.  While we certainly want to do this and did have plans to implement the SAP payroll and HR system (which does have that capability), those plans have been delayed because of the recent downturn in business and our need to reduce the dollars available for capital projects.
   
   We also have had the suggestion to eliminate check stubs and give them out only upon request.  Unfortunately, current payroll laws in the country require that we provide either a paper or electronic check stub for every payroll check issued.
   
   As soon as we can free up enough investment dollars to implement the next generation payroll and HR systems, we will be very excited to offer these enhancements.

May 11 , 2009

1. Why does Greenheck allow smoking on the premises?
   
   Please see work rule #1 on page 58 of the current WI Union contract.
   
   
2. Since the President signed the American Recovery and Reinvestment Act (ARRA), will you now notify laid-off employees of their new rights regarding insurance coverage through COBRA?
   
   Yes, all laid off employees have been notified of the new COBRA laws. Greenheck utilizes UMR to administer its COBRA program. All employees that were terminated prior to March were mailed a letter from UMR prior to April 10. Employees that were terminated after March 1 were mailed a letter from UMR prior to April 25.
   
   
3. Why does Greenheck continue to send employee checks home in the mail? Wouldn't it save the company money to just have the supervisors hand them their checks at work? During these times, the company should cut unnecessary costs like this, correct?
   
   We agree that all unnecessary expenses need to be eliminated. However, we currently feel that mailing paychecks directly to the employee's home is the most cost-effective way of delivering the checks. Prior to 1999, supervisors were actually responsible for delivering checks directly to their employees. Not only was this a non value-added task performed by the supervisors, but shop productivity suffered on paydays due to employees participating in 'check pools', etc.
   
   One way that we could cut unnecessary expenses would be to convert the WI shop employees from a weekly payroll to a biweekly payroll. Since we would only be processing payroll half as often, the company would save 50% of mailing costs, 50% of check clearing fees, as well as 50% of the cost of the check forms. Currently, the WI shop employees are the only group of Greenheck's 2,400+ employees that are paid on a weekly basis. The WI office employees, as well as other groups, recently converted from a weekly to a biweekly payroll and the company is realizing a significant cost savings because of it.
   
   
4. Why is it that as Greenheck orders pick up the de-classified transfers are unable to get their jobs back? There are not postings available either.
   
   Will the transferred people who were trained in other facilities be going back to their jobs when the laid off workers come back in May? We were told all of the laid off workers will be going back to their old jobs, so what about the ones who took their place when the lay off occurred? It seems that we will have too many people now and no where to put them.
   
   I would think the company would be able to move some displaced workers back to their original shifts with the summer help coming in. Will it be done?
   
   The laid off employees are being brought back to cover for summer vacations, replacing the summer students we have hired in past years, not due to an increase in order volume. We are not forecasting a significant increase in order volume in the foreseeable future. Therefore, all employee moves are being considered temporary at this time. Remember the reason for calling back laid off employees is to cover for the 10-15% of our workforce that is off on vacation beginning in early June.
   
   The laid off employees are returning as unclassified entry. In this classification they can be moved to almost any job. When practical, we will be bringing them back to the plant they had worked in. This will be likely in many cases because the plants needing the most summer help are also the plants that lost most of the employees during the layoffs. In some cases we may be moving people from the unclassified general group back to the positions they had been in, but will not reclassify them. However, this is not possible in many of the situations, because those positions are no longer needed on a permanent basis.
   
   Our primary focus is customer service. We need to continue moving employees to the work, to ensure that we are able to meet customer expectations.
   
   
5. Why is there an increase in union dues?
   
   All changes to union dues are determined by the union. Greenheck has no input into these decisions. Questions regarding dues increases should be directed to the leadership of your Union.

April 14, 2009

1. We have been hearing lots of stories of the hoods down south that they have been having lots of bad reports in the field on how the units are falling apart and bad workmanship and now you want to move UDS down there also. We think you should reconsider moving UDS and also bring back hoods to Wisconsin so Greenheck again can have top quality units in the market.
   
   Answer: As you know, we take manufacturing a quality product very seriously and do monitor it closely. One of the measurements we have in this area is tracking the number of problems reported by our customers and the money spent to correct these issues. In reviewing the data over the last nine years, we are happy to share with you that the number of field problems per million dollars of sales has never been lower. In addition, this year we have spent less then half the dollars to correct problems in the field compared to fiscal 2007, the last year hoods were manufactured in Wisconsin. Granted, we worked through numerous issues the first year associated with the manufacturing move and training the completely new work force in North Carolina, but we are proud to report with two years under our belt we are producing a high quality product and will continue to strive for further improvement.
    
2. In order to conserve company funds, will office employees be given the option to take more than 1 week off without pay during the summer months?
   
   Answer: The combination of actions announced last week which included the reduction in office headcount, the requirement that all office employees take one week off without pay during the first quarter, and a delay in any merit pay adjustments by at least six months were designed to ensure our ability to meet our profit objectives based on our revenue projections for the fiscal year. As was stated last week, if the sales revenue is below our projections we will have to look at all of these options for additional cost cutting opportunities and that could result in additional time off being required of our employees. Any decisions regarding additional time off will not occur until the June time frame after we have several months of order activity for the current fiscal year.
    
3. In lieu of eliminating positions, has creating more majority time and part time positions been considered? This would help the company avoid costs associated with benefits, and keep employees around until the economy improves and full time work may be provided?
   
   Answer: While all of these options were considered the ones chosen were those we felt would save the most jobs and yet have the greatest impact on the financial position of Greenheck during this fiscal year. If orders do not meet projections, these items would be looked at as options to reduce cost while maintaining our skilled staff.
    
4. Why did we have an advertisement in the Sunday paper to hire people for Airolite 3 days before we laid off more office people? I've heard a lot of grumbling about this ad, but I'm actually going to post this question.
   
   Answer: We have always indicated that even during these difficult economic times and with us having to reduce staff that there would still be some limited hiring going on to fill key roles needed to serve the business we are continuing to receive. The Airolite positions are replacements for eliminations in Ohio and are being filled in Wisconsin. We did review the skills of all the people affected by our decisions last week and if they had the skills to fill these roles they would have been transferred. We are still a profitable, dynamic organization and even during this down turn we will have needs to hire some people.
    
5. It seems neither plausible nor prudent that not one person with a Vice-President, General Manager, or Director title was laid off in the reduction of approximately 100 office employees since December. 100 office employees is the equivalent of one business unit. It would seem the decision to keep all VPs, GMs, Directors on staff is making us uncomfortably top-heavy. Please explain why this makes sense.
   
   Answer: While it appears that no changes have occurred at this level, we in fact are operating with two fewer Vice Presidents than we had a year ago with the departure of the Finance and Manufacturing Vice Presidents. Those individuals were not replaced, and their roles were divided among the remaining staff. Just last week, we announced the movement of Andy Wilcox to run the Innovent group and that Mike Wolf would be taking on his role for ERV/MUA along with the retention of responsibility for Precision Coils and Small Air Handlers. It is important that we continue to look at the size of our leadership team in relation to the overall business size, but yet maintain the continuity and consistency of leadership that is so critical to a successful business.
    
6. How were the recent cuts of company employees determined? Some very good people no longer have jobs, while others that are not so good are still here. Does a qualified person decide or someone who just has an axe to grind?
   
   Answer: Decisions to eliminate someone�s role at Greenheck are taken very seriously and for the most part are the result of looking at ways we can restructure work to cut costs, eliminate work, or reduce capacity needs-- reflective of the smaller business volumes that we are likely to face during the next year. Unfortunately, in these tough times some very good people were let go because of our declining business volume.
    
7. Office employees need to take a one week lay off sometime before July. Would this work for shop employees before any other lay offs are considered.
   
   Answer: At present, with the layoff decisions made in December and February for factory staff, the number of employees we have on the payroll is pretty adequately matched to the order volume that is coming in the door. If that should change we would look at multiple options before making the decision to layoff--the first being how long we consider the downturn will last. If it is short term, some of those solutions like short work weeks or one-week layoffs will work to temporarily reduce capacity until project order intake would increase. Our present labor agreements have some limitations on our ability to implement some solutions, and would require that discussions with the employees� elected representatives take place before a course of action would be finalized.

March 23, 2009

1. Are you starting to call people back?
   
   Answer: While we would hope we can call back our laid-off employees, the present order situation does not look like it would support additional employees. We evaluate that situation every several weeks, and as soon as it looks like orders are increasing on a permanent basis we would look at our needs to bring some of the laid-off employees back to work. But there are no immediate plans to do so.

March 2009
(These were questions were submitted throughout February 2009)

1. How is an employee's insurance affected when they are laid off?
   
   Answer: All employees that are laid off receive a packet of information detailing exactly what will happen with all of their Greenheck-provided benefits. Basic Life Insurance, Supplemental Life Insurance, Long-term Disability Insurance, Dependant Care Flexible Spending and Health Flexible Spending all end on the last day an employee works. For this most recent group of laid off employees, these benefits will end on either February 6 or 13. Health and Dental Insurance benefits continue through the last day of the month, so for this most recent group of laid off employees, coverage will end on February 28. If the employee is currently participating in either the Health Insurance or the Dental Insurance plans, they have the option to continue their coverage at their own expense for up to 18 months following the date they lost coverage.
   
   
2. We have heard from a few of the people that were affected by the recent layoff that there is another layoff planned for about two months from now. Is there any truth to that? When do you anticipate being able to recall the union employees? Are there any predictions as to when orders will be picking up?
   
   Answer: There are always rumors in these unsettled times regarding potential future layoffs, etc. At present, we feel that we have done an adequate job of balancing the shop workforce to the order intake volume. We hope that our order intake stabilizes around the revised forecast levels. But no solid predictions for the future can be given and if future orders are weaker than anticipated, additional adjustments to the size of the workforce may have to be taken. We do not know if and when we will be able to recall any of our laid off team members, and we do not have any solid indications about when order levels may increase.
   
   
3. For all of us affected by the temporary transfer in the shop, I understand that after 90 calendar days our pay will be adjusted to match the new job. Does that mean that our job classification will change as well? Will we be allowed to go back into our old job when things pick up, or will we have to sign new job postings to try to get back into our pre-transfer classification?
   
   Answer: Due to the economic downturn and the resulting layoffs, many production employees are being moved to new positions. Many of the displaced employees are coming out of Fan and Vent. Based upon the forecast for Fan and Vent, it is unlikely that these employees will be needed back in the foreseeable future. Therefore, a strategy was needed to remove them from their current classifications. The Letter of Understanding language was agreed on to address this issue. Click here for the Letter of Understanding.
   
   
4. Wouldn't it save the company money to charge a per person health insurance premium? The fee would be the same for each and every person covered by the health insurance. Currently, singles pay about half as much as a family, but a family can have an unlimited number of people in it. Where is the money currently coming from to pay for all of those additional family members?
   
   Answer: Greenheck strives to provide excellent benefits at an affordable level for all employees. The norm in the industry is to have either two or three benefits levels for health and dental insurance. Under a plan with two levels, an employee can choose between only single and family levels. Under a plan with three levels, an employee can choose from single, employee + 1, or family. Greenheck is currently opting to utilize the three level plan.
   
   
5. With the slowdown in shipments, why are we still running a third shift in the shipping department?
   
   Answer: Recently we have adjusted shifts, combined areas, eliminated some shifts, etc. However, we still have work that is coming off assembly lines 24 hours a day, which does require us to have shipping staff working to handle the finished goods and get those shipped as soon as possible so that we can continue to support our customers.
   
   
6. Will the employees that are laid off be able to keep what the company put into their 401(k) accounts even if they are not fully vested?
   
   Answer: Employees that are laid off will only be eligible to receive their vested portion of the company 401(k) contributions. The vesting schedule for Greenheck's 401(k) Plan is as follows: 0% vesting after 1 year of service, 20% vesting after 2 years of service, 40% vesting after 3 years of service, 60% vesting after 4 years of service, 80% vesting after 5 years of service, and 100% vesting after 6 years of service. This vesting schedule applies to all employees that leave the company for any reason. The only exceptions to this rule are for death, disability or retirement.
   
   Employees are always 100% vested in the contributions they made through payroll deferrals as well as their rollover contributions.
   
   
7. Many of the welders were bypassed in the most recent round of layoffs because of their skills. Since the shippers are required to have a CDL license, were any of them bypassed?
   
   Answer: The union contract allows the company to bypass employees from layoff based upon skill. Welders were exempted because of order demand in factories that require a high level of weld and the investment we have made in hiring and training for this skill. The number of welders bypassed in the layoff was determined based upon forecasted production needs, allowing us to meet customer demands. Not every welder is needed every day, but if we do not have this skill available when it is needed we create bottlenecks in the manufacturing process.
   
   We have not bypassed employees in any other production classification. Our training investment is not as great in other classifications and the forecasted order volume has not required a need to exempt any other skill group.
   
   
8. Will the group of employees that were placed on layoff on Feb 6 and Feb 13 be receiving a VISA gift card like the first group of laid off employees received?
   
   Answer: The first group of employees that were laid off in December did receive a VISA gift card from Bob and Dwight. This was done in an effort to help these affected employees cope with loosing their job just before the Christmas holiday.
   
   
9. Many of the recently laid off employees were not 100% vested in their 401(k) accounts. If an employee is only 20% vested, what happens to the other 80%? Does the company get to keep the money?
   
   Answer: When an employee leaves Greenheck and they are not 100% vested in their 401(k) account, any amount they are not vested in is forfeited. However, these forfeitures are not returned to the company, but rather are re-distributed to the remaining employees. This is the way the Greenheck 401(k) Plan has always operated. Other companies may choose to handle forfeitures in a different manner.
   
   
10. Will the group of 155 shop employees that were laid off in February be receiving a severance package like the first group of 111 shop employees did?
    
    Answer: The first group of laid off shop employees (111 announced in December) did not receive a severance package. The group of 155 from February will not be receiving a severance package either.
    
    
11. There are rumors that more employees will be laid off on March 1. If that is true, why doesn't Greenheck make all the cuts needed at one time and stop stringing people along? Many employees are very upset and unhappy to hear these constant rumors.
    
    Answer: No layoff is planned for March 1. In times like these there will always be rumors circulating through the company and the community. Unfortunately, Greenheck cannot control the rumor-mill.
    
    
12. If business picks up will there be overtime offered to the remaining shop employees before people are called back from layoff?
    
    Answer: Overtime is used to offset fluctuations in production on a short term basis. We will continue to use overtime as a strategy to offset volume changes in production due to bottleneck processes, large orders, increased order demand that is not projected to continue, vacations, etc. If order intake begins to increase on a consistent basis, our goal is to bring back laid off employees as needed.
    
    
13. Are we losing orders because Greenheck shipped work to Mexico�c.work that used to be performed right here in Schofield? Also, they are talking about moving machines to places where they would benefit the company. Are any of these machines being moved to our plants in China or Mexico?
    
    Answer: The products that are being built in Mexico for the Grainger distribution system are products that were made by a competitor by the name of Emerson Electric. They are low cost basket fans that were never built by Greenheck prior to this opportunity. It is an unfortunate misconception that work has been taken from Schofield and moved to either Mexico or China. Nothing could be further from the truth. In fact, in spite of the layoffs, we have added 100's of jobs to our US-based workforce since our plants in China and Mexico were opened. Those two facilities, by their location and access to different regional markets, have given us business both for those plants and for our plants in the United States that we would not have received in the past, contributing to greater employment in our US factories.
    
    
14. Wouldn't the company save money by cancelling the picnic and ALL other company parties?
    
    Answer: While there are some additional dollars that could be saved by cancelling all outside functions, what is remaining in this year's budget would not support the cost of even one additional employee. We have reduced our activities having cancelled the Winter gathering and will continue to look at the activity for next year, it is important that everyone remember that we still have 2,500 employees and it is important and probably even more so in these stressful times that some level of simple and tasteful activities for employees still be held.
    
    
15. How has the United Way helped out the employees who have been laid off?
    
    Answer: We have taken the liberty of including the list of United Way Agencies that receive funding from our Community Based United Way Drive. As you know, through the generous donation of our employees and Corporate matching dollars, we are one of the largest contributors in the community. Due to reasons of confidentiality we will never know exactly who has used any of these agencies, but certainly many of our laid off employees, family members, etc. have made use of the services provided by one or more of these organizations.
    
    It is through your generosity and that of many other individuals and companies in the community that these programs exist to assist those individuals who are in need. Click here for the 2008 Partner Programs and Funded Agencies.
    

January 30, 2009

1. Has Greenheck considered pay cuts and short work weeks as ways of cutting costs instead of laying off employees?
   
   Answer: Yes, we have considered these cost cutting methods; however, these tactics alone would not have been enough to avoid the layoffs that were previously announced. If the economy continues to slide into a deeper recession, we may need to implement these, or other types of cost-cutting methods. In order to ensure fairness, these types of changes would need to be put in place across the entire organization.

2. Why don't the Continuous Improvement Leaders go back to the shop floor since there aren't any new employees to be trained?
   
   Answer: During poor economic times like we are currently experiencing, it is vitally important to continue finding ways to create efficiencies and reduce costs. Our GPS projects and our CI Leaders have made significant improvements to Greenheck's profitability since the GPS program was implemented back in 2002, and these programs will continue to be critical to Greenheck's success in the future.
   
   Also, although there are not any new employees to be trained, there are a large number of existing employees that need training because they are moving to new jobs due to the recently announced layoffs.

3. If we are cutting costs, why do we still have so many Production Managers, Plant Managers, Value Stream Leaders, Supervisors and Team Leaders?
   
   Answer: Economic conditions may deteriorate further in the future, and Greenheck will need to continue adapting to this extremely challenging business environment. All Business Units and Functions within Greenheck will need to review their current structure and make appropriate changes to ensure the success of the company.

January 29, 2009

1. If the company is laying off again, how come office people are still being hired at this time?
   
   Answer: We expect to do very little hiring given all the uncertainties of the worldwide economic situation. However, as we have needs for specific skill sets, or need to support our growth areas, we will have to still do some selective hiring. It is our intention to review the skills of laid off office workers and determine whether we need to recruit a new employee, or can call back a laid off employee or transfer someone to that role whose position may be in danger of being eliminated.

2. Why are we saving the welders again in the next layoff? I thought the Union Contract says you can only do it one time a year. Also, if we are saving the welders again, why are so many of them crating?
   
   Answer: The reason we are exempting some welders from layoff is the result of order demand in our CVI and Airolite product families. Both of these factories have order commitments for the next several months. Those products include a heavy welding component as part of the fabrication process, and that makes it critical that we maintain those skills in our workforce. The union contract does not have any restrictions on the number of times we can exempt skilled positions from layoff during a calendar year. The contract indicates that in times of layoff the company can exempt skilled employees from the layoff.

3. Are any additional layoffs imminent? I understand there is apprehension in delivering such information early but please understand that many employees fear their jobs could be lost. Job security is an important facet to job approval. Job approval is a leading contributor to motivation. Motivation is what is needed to move Greenheck into the future.
   
   Answer: There are no immediate plans for additional layoffs, but what the future holds in terms of order intake will determine what actions the Company must take. It is not anyone�s desire to have additional layoffs, but we are dealing with an economy that is rapidly becoming the worst downturn since the 1930s. Our sales and marketing teams are aggressively working with our manufacturer's representatives and other sales channels to put efforts and incentives in place to go after every job that becomes available in our market space. Remember, our reps are not salaried employees of Greenheck; they are independent commission based sales people who only get paid if they sell our products. Their bills, their lifestyles, only get supported if they sell product manufactured in our plants. We believe they are starting to get extremely aggressive in terms of taking the orders that become available.
   
   We, as direct employees of Greenheck, must focus on what we can control. We cannot control what happens in the general economy and what that will mean to the commercial construction markets. But we can control our commitments to our customers, to deliver high quality products, shipped on time. We can commit to our customers that we will get them answers to their questions on a timely basis no matter where that information needs to come from in the company.
   If we can do the things well that we control, we will win even in a down economy and protect our jobs and strengthen our future.

4. Will Greenheck run 4 days a week if need be due to work loads?
   
   Answer: We continue to explore all options for reducing capacity as order volume declines. Short work weeks are most effective when the situation looks to be short term in nature and you want to protect capacity so you can quickly ramp up to meet demand. With this being the worst recession since the 1930s, we cannot say with any certainty how much more demand for our products will decline and how long the downturn will last. Consequently, that makes the need to adjust our factory capacity a long term situation, best solved by reductions in our workforce.

5. I know of a few companies that do their payroll strictly on-line. They don�t distribute checks, and everything is done electronically. Is that a possibility?
   
   Answer: We do think it is a good idea, but unfortunately our payroll system that is a late 90�s vintage software does not support this method. It does not have the capability of storing the data on-line for individuals to view at their convenience. New versions of payroll systems do, and in the future as the business conditions permit, it is our desire to migrate to the SAP payroll and human resources system which will allow this. We have announced the switch to Bi-weekly payroll for all locations and employees, with the exception of our Schofield Union employees.

January 19, 2009 Questions

1. Have any other employees been laid off since those announced on December 12, 2008?
   
   Answer: No additional employees have been laid off since the 164 announced on December 12, 2008.
    
2. Currently Greenheck runs 3 shifts in many facilities. Is there a possibility that we will eliminate any shifts as work decreases?
   
   Answer: Shifts could be eliminated. These decisions will be made on a plant specific basis and will depend on order demand and efficient operating strategies.
    
3. What is the status of the new Reno facility? If this project moves forward, how many positions will it create?
   
   Answer: Due to the recent economic downturn, the Reno facility decision is still being evaluated. If we do proceed with the Reno facility, it is estimated that we will employee 50 - 60 employees within 1 -2 years, allowing us to attract new business we are currently not getting.
    
4. What program cuts and other cost reductions have been implemented recently?
   
   Answer: The company continues to evaluate all expenses to determine ways to reduce costs. Programs and expenses that have been cut or reduced include Winter Fest, Quarter Century Club dinner, advertising costs, travel and many others. Overall operating expenses are showing a significant downward trend.
   
   In some cases, it is determined that programs are necessary to support our ongoing operations. Programs that will continue are GPS (see response below), ongoing employee communications (Thought You'd Like to Know) and the safety recognition programs.
    
5. Since the company is cutting costs, will the GPS program be suspended?
   
   Answer: No. The GPS program will not be suspended. Since implementation, the company has seen significant bottom line savings from this program. Continuous improvement is vital to our current and future economic success. As has been done in the past, all future GPS pit stops will be evaluated to ensure a positive return.
    
6. Are there opportunities for laid off employees to continue their education?
   
   Answer: Local Job Service provides many services to laid off employees. We have set up meetings for our laid off employees to receive information on these programs.

December 19, 2008 Questions

1. Has the company considered outsourcing some of its functions such as IT, Finance and HR?
   
   Answer: Yes, the company routinely accesses what is the most cost-effective way of providing all of its services, including those services performed by IT, Finance and HR.
   
   
2. Can laid off employees relocate to the Reno, NV plant?
   
   Answer: The new plant in Reno is not expected to be operational until the summer of 2009 at the earliest. At that time we will review the practicality of offering the positions at the Reno plant to displaced workers.
   
   
3. Will the company be issuing $15 Christmas gift certificates to all employees like it has done in the past?
   
   Answer: As was mentioned in an earlier response, the company has made a comprehensive review of all of its ongoing expenses and has made reductions wherever possible. For this year, we have decided to eliminate our long-standing tradition of issuing the $15 Christmas gift cards to employees. It is also not appropriate to be spending limited company funds in this way when so many of our co-workers have been recently impacted by the layoffs. When the economy improves and our financial condition brightens, we certainly hope to be able to offer this program at that time.

December 18, 2008 Questions

1. What factors were taken into consideration in deciding which employees were directly impacted by the down-sizing?
   
   Answer: Per the contract with our unionized workforce, it was primarily seniority that was used to make the decision, with the least senior being laid off first. The one exception granted the company per our labor agreement is the ability to exempt individuals from the layoff based upon the company's current need for their skills. We did choose to exempt from layoff a number of welders who are critical for current production vrolumes in the CVI and Airolite plants in Schofield. In a recessionary economy, meeting customer expectations and the ability to deliver product faster than our competition results in business. We made those exceptions for welders so that we would not damage our production capacity in areas with strong order backlog.
   
   The office staff was reduced as a result of each business unit or function evaluating future work priorities and making critical determinations on the essential skills and abilities needed to continue to carry out their basic mission. Given the requirement to reduce operating expenses, existing staff was then evaluated versus those needs and the difficult choices were made.
    
2. It seems like some of the recent events at Greenheck were implemented only to make the company more attractive to an outside buyer. Is the company for sale?
   
   Answer: It is absolutely not for sale. Dwight Davis and the Robert Greenheck family have every desire to continue to run Greenheck as a private, independent company. The actions of the past several months have been taken to reduce operating expenses in an effort to strengthen our profitability so that we can continue to meet our debt and investment obligations which are critical to our long-term growth and success. The recent decision to reduce our staff was the result of the deepening recession and its continuing impact on Greenheck and its markets.
    
3. Why didn't the company try to cut back on other spending before employees were cut?
   
   Answer: The Company has been cutting back on spending. As early as July, all functions and business units were asked to reduce spending and cut unfilled positions from their budgets. As the orders continued to soften and profitability began to erode, in late September all areas of the company were again asked to further reduce operational spending, capital spending and eliminate more of their open positions. By October we began to see a positive impact of reduced spending. Unfortunately, the reduction in operating expenses has not been enough to offset the growing earnings pressure that has resulted from a continuing deterioration in order intake caused by the worsening economy. All expenses are under continued scrutiny.
    
4. Have any of our competitors been affected by the current recession? Is Greenheck losing market share in any of its product lines?
   
   Answer: Since most of our competitors are private companies, we do not know their sales for sure. However, what we do know is that according to our trade association, AMCA (through which all members report their sales), our overall market share continues to grow. If our market share is growing in a shrinking total market, we must be taking sales away from our competitors. We have to assume that our competitors are seeing the same softening in the market and are making similar adjustments to their expenses and capacity that we have had to make.
    
5. Will profit sharing and the 401(k) match still be paid out this year?
   
   Answer: The amount of the 401(k) match is tied to the company's profitability for the entire year and cannot be determined until the end of our fiscal year, which is March 31, 2009.
   
   Our profit sharing plan is also tied to the company's profitability for the fiscal year so it is not possible at this point in time to determine if a payout will be possible since we still have over three months remaining in the fiscal year. As the year progresses, we will keep employees informed of the status of this program.
    
6. Will the Company be issuing a list of the office employees that were placed on permanent layoff?
   
   Answer: No. We have weighed the issue of privacy versus need to know. We believe that everyone in the various business groups and functions know who among their co-workers was adversely impacted by the need to reduce staff. We will soon be issuing new phone directories, organization charts, etc. which should help to clarify reporting roles and areas of responsibility on a go-forward basis. Additionally, we know that all areas impacted by these decisions are actively engaged in reassigning critical tasks and will soon be communicating those changes.
    
7. How was the severance package for the office employees decided on?
   
   Answer: Greenheck does not have a "standard" severance package, but instead, develops a package such as this one based on our current business situation. Many factors were taken into consideration to ensure that the severance package that was offered to the office employees was fair to everyone. If you looked externally at the norms in business you would find the amounts offered our departing office staff were on the upper end of what is typically provided.
    
8. Why weren't the reductions in the office staff even across the whole company? It seems like the Business Units were not impacted as much as the shared service functions.
   
   Answer: All business units and shared service functions were treated the same. Reductions were not limited to full-time employees, as part-time employees and open positions were also included in the workforce reduction. Because of this, some areas may not appear to have been impacted as much as others, but that is only because these areas had a significant number of open positions that were able to be eliminated in this process.
    
9. Instead of laying off the union employees, why can't we just move them to the business units that have a lot of orders such as CVI?
   
   Answer: The company routinely moves shop employees from one plant to another to aid in reducing backlogs or filling in for employees who are on vacation. For the past several months, as new orders declined in only one or two plants, we were able to keep everyone working by constantly monitoring and adjusting the workforce by plant. Now, faced with a significant decline in orders across essentially the entire company, there is simply no plant available to move the employees to.
   
    
10. Why is the company no longer loyal to its employees like it had been during the past 10 or 20 years?
    
    Answer: While it is true that during the last 10 or 20 years Greenheck has not had a workforce reduction, it is also true that we are in the midst of the worst economic crises the company has ever been faced with in its 61-year history. The current drop-off in orders is significant and unprecedented. When the economy improves and our order stream improves, we look forward to being able to recall a number of the laid off workers.

December 12, 2008 Questions

1. How many people does Greenheck employ and how many are being
   laid off?
   
   Greenheck's worldwide workforce numbers 2,800 people which is now being reduced by 164 (111 factory; 53 office). The majority of laid off employees are at the company's Schofield, WI location, which is the largest employment center.
   
   During the last three years, the company has experienced tremendous growth, which lead to the creation of 710 new jobs, 450 of which were in Schofield.
   
   
2. Greenheck has been able to grow substantially in recent years, and was still hiring just a few months ago. Why the abrupt change?
   
   Greenheck's sales through November are up close to 15% over last year. This success has been achieved despite a downturn in the U.S. non-residential construction market that started a year ago. However, as the worldwide economic crisis has worsened in recent months, new orders have been declining in some Greenheck business units.
   
   The company was staffed to meet the order demand it was achieving in July. Now, with orders rapidly slowing as the worldwide economy falls deeper into recession, we have no choice but to reduce our workforce.
   
   We must all remember that we are living through the worst financial crisis since the Great Depression, and the worst in the 61 year history of Greenheck! Nevertheless, Greenheck is growing, and driving hard to continue growing!
   
   
3. Last February and March the company used voluntary furloughs to reduce its' workforce. Why isn't this approach being used now?
   
   Last February and March we decreased our workforce by around 60 people in response to an order slowdown in one of our larger business units. We felt the problem was short-term. This proved to be the case. As a result, we used voluntary furloughs and were able to call all furloughed people back to work in only a few months. In fact, by early summer we were achieving growth beyond our expectations and added many new workers!
   
   The situation we face now is very different! Now, we have seen a slowdown in new orders in some of our businesses, this has been especially dramatic in November and December. As the worldwide economic crisis grows worse by the week, we are expecting a continuing adverse impact on non-residential construction. The only hope is that the various economic stimulus actions will start to have a positive effect. With all the uncertainty of the current situation, we must protect the financial strength of the company and reduce our workforce immediately.
   
   If we are able to continue growing, and the various governmental actions restore business and consumer confidence, we look forward to recalling many laid off workers.
   
   
4. Greenheck has had a long history of not participating in recessions - is this no longer management's belief?
   
   Yes, all members of the Greenheck Team, past and present, are proud of the fact that we have experienced steady growth for decades, despite many economic downturns and recessions. This is still the case! The company's sales are up close to 15% over last year, despite a downturn in non-residential construction that started a year ago. In fact, the last report we had in late summer showed U.S. non-residential construction down around 13% from the prior year. Since that report, the worldwide financial crisis has exploded. We are sure the next report will show much more decline in construction activity in the U.S. and throughout the world.
   
   So, the fact is Greenheck is still growing despite this deepening recession! However, the size of our workforce is based on a higher growth rate - which we were realizing during the spring and summer of this year. Now we must reduce our workforce in response to the rapidly deteriorating economic conditions over which we have no control!
   
   
5. Most of the people being laid off were hired in the past year, and some only a few months ago. Why couldn't management see this downturn coming and have avoided hiring these people?
   
   In late summer our order backlog and new order rates overall were above our expectations. In July, overall new order volume was up 18% over the prior year. We knew we were in an economic slowdown, but our growth strategies were delivering beyond our best estimates!
   
   By September the U.S. economic crisis was exploding beyond anyone's expectations. Most economic experts did not see the severity of what has now become the worst economic crisis since the Great Depression!
   
   Even with the bad economic news of early fall we had no idea things were going to become as bad as they have. In addition, we had an order backlog in many of our businesses that required most of them to work overtime to meet customer delivery expectations.
   
   It wasn't until November and December that we saw new orders really begin to seriously decline in some business. Even now, we still have businesses, such as Innovent, experiencing substantial new order growth. (Innovent manufactures and sells large custom energy recovery and air handler equipment).
   
   So, with these realities we had to staff up to meet the demand our sales strategies were delivering. Now, with the worsening worldwide economic crisis, we have to "down shift", although the company is still growing overall.
   
   
6. How are our competitors doing?
   
   Since most of our competitors are private companies, we do not know their sales for sure. However, what we do know is that according to our industry trade association, AMCA (through which all members report their sales), our overall market share continues to grow.
   
   
7. Will there be more layoffs?
   
   We certainly hope not, but simply do not know for sure. We are aggressively focused on doing everything practical to keep Greenheck growing profitably. We are confident that the Greenheck Team of employees, loyal sales partners, and suppliers will press hard to keep winning, and keep people working!
   
   
8. Why is the company starting a new plant in Reno in the midst of this economic crisis, and when valued employees are being laid off?
   
   The new plant in Reno is in response to our rapidly growing outdoor air product business. The core of this plant will be Innovent products, which are in high demand given their contribution to energy efficient building operations. They are a part of Greenheck's overall "green" capabilities.
   
   With the continuing order growth we see at Innovent, as well as the demand for our other energy efficient products, we feel taking this investment risk is one more example of how we can keep Greenheck growing despite difficult economic times.
   
   It is also important to realize that these products are large (generally the length of a semi-trailer), and to be competitive they must be made close to the market. To ship one of these units from Reno to California versus from the mid-west saves thousands of dollars in freight costs.
   
   Finally, every Innovent unit and other energy recovery or make-up air product uses Greenheck fans and dampers which come from our Schofield plants. So, the growth we can leverage in Reno by better serving customers in the western U.S. market, enables jobs in Schofield.
   
   
9. Will Greenheck still be recruiting while valued employees are on lay off?
   
   Laid off factory workers will be called back to work based on work demand. Their call back rights are governed by their union contract.
   
   With regard to office workers, we expect to do very little hiring given all the uncertainties of the worldwide economic situation. However, as we have needs for specific skill sets, we will review the skills of laid off office workers and determine whether we need to recruit a new employee, or can call back a laid off employee.
   
   
10. What can all members of the Greenheck Team do to drive growth?
    
    The Greenheck Team has a long history of overcoming tremendous odds to keep the company growing profitably. This "can do" attitude, coupled with the support of loyal sales partners and suppliers has created a legacy of success through good and bad times.
    
    It is likely we are in the midst of our greatest challenge ever! We are still growing with sales up 15% over last year. We have many growth initiatives that are showing good promise. Yet, all members of the Greenheck Team must rally every day, in every way with a relentless commitment to win. We must deliver for our valued customers with high quality products, on-time shipments, and superb service. We must drive to achieve productivity gains necessary to protect the company's profitability.
    
    Finally, we must stay true to our values, which are the foundation of OUR success, they are:
    
    • Easy to do business with
    • Ongoing investments in People and Operations
    • Making a Difference in the Community
    • Mutually Beneficial Partnerships with Sales Representatives and Suppliers
    • Integrity and Professionalism
    • Continuous Improvement Through Learning, Innovation and Teamwork