UPDATE: Eaton outsourcing WI jobs to Mexico again, despite getting $370K from WEDC
WATERTOWN (WKOW) -- A global power systems management corporation that has received nearly $370,000 in tax incentives from the Wisconsin Economic Development Corporation (WEDC) since 2012 is shipping jobs from Wisconsin to Mexico for the second time in three years.
Eaton Corp. announced last week it is permanently discontinuing the manufacture of printed circuit boards at its facility in Watertown, which will result in the elimination of 93 employees there.
"We first informed employees in April 2014, one year ago, that we would be moving the Printed Circuit Board (PCB) line from Watertown and consolidating it into another existing facility in Tijuana, Mexico," Eaton Corp. Spokesperson Ann Marie Halal told 27 News. "These actions are in response to ongoing business and market conditions and a continued challenging business climate. They will allow the business to continue to compete globally and meet market demand."
A 27 News investigation from July 2014 found that Eaton Corp. had received over $190,000 in WEDC tax credits despite laying off 163 employees at its Cooper Power Systems plant in Pewaukee in April 2013. The company moved those jobs to Mexico as well.
WEDC records now show that since 2012, the agency has awarded Eaton Corp. with $369,307 of a possible $1 million in job creation tax credits. During that time, Eaton has retained 154 jobs in the Wisconsin while adding 25 new jobs. The 93 layoffs announced last week have not been calculated into WEDC's job retention/creation figures yet.
Mark Maley, a WEDC spokesperson, said agency officials have already reached out to Eaton officials to discuss the impact of their decision on the company's current contract.
"All companies that receive awards from WEDC are contractually required to meet certain objectives, which typically include job creation, job retention and/or capital investment. Companies failing to fulfill contractual obligations are subject to clawbacks or denial of tax credit claims," Maley told 27 News Monday evening.
In September 2014, the WEDC board passed a measure stating that companies which outsource would have to disclose that information in their annual reports to WEDC, while new companies seeking funds would have to sign a document stating no WEDC money will be used to outsource Wisconsin jobs.
The measure also stated that companies which accept awards, then later reduce their net number of jobs in Wisconsin, cannot get any more actual money until they get their workforce back to where it was when the award was originally given out.
Eaton is not closing its Watertown facility, which originally opened in 1957. 124 people will still be employed there at the end of 2015.
Eaton Corp. is based in Dublin, Ireland, but has numerous offices and interests in the United Kingdom, United States, Indonesia, Singapore, France, Germany and Mexico. The company specializes in electrical, hydraulic and mechanical power systems management.
According to the company website, Eaton Corp. had $22.6 billion in sales in 2014.
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