2010-26769. Dawson Metal Company, Inc., Industrial Division, Jamestown, NY; Notice of Negative Determination on Reconsideration

On January 21, 2010, the Department of Labor issued an Affirmative Determination Regarding Application for Reconsideration for the workers and former workers of the subject firm. The Department's Notice of affirmative determination was published in the Federal Register on February 16, 2010 (75 FR 7030). The workers are engaged in employment related to precision sheet metal fabrication.

The initial negative determination based on the findings that the subject firm did not increase their imports of articles like or directly competitive with the articles produced by the workers during the relevant period and did not shift to a foreign country the production of like or directly competitive articles. Further, a survey of the major declining customer of the subject firm regarding purchases of precision sheet metal fabrication for 2007, 2008, and January through April 2009 revealed decreased imports. The investigation also revealed that the subject firm is not a supplier or downstream producer to a firm that employed a worker group eligible to apply for Trade Adjustment Assistance (TAA).

In the request for reconsideration, the petitioner alleged that, in November 2008, the subject firm's largest customer transferred forty percent of its base contract for self check-out cabinets to a firm in Canada, and that the shift in supplier caused a downturn in business for the subject firm and the subsequent worker separations.

In response to the request, the Department sought further details about the circumstances surrounding the separations, especially the relationship between the separations and the alleged decline in sales to a customer which allegedly began to outsource like and directly competitive articles from a Canadian firm.

The reconsideration investigation revealed that the workers are separately identifiable by product line and that the subject firm sold two types of precision sheet metal fabrication to the customer named in the request for reconsideration: Sheet metal cabinets for self check-out units, and sheet metal parts to modify those basic cabinets to accommodate a variety of peripherals, such as computers and cameras.

The reconsideration investigation regarding self check-out units revealed that the subject firm's largest customer did transfer a significant proportion of its purchases of such cabinets for self check-out units to a foreign source; however, during the relevant period sales of these self check-out cabinets to this customer increased significantly.

Further, an analysis revealed that, although the subject firm's share of cabinet purchases by this customer declined, that customer so greatly increased the amount of its purchases of self check-out cabinets overall that its purchases of those items from the subject firm actually increased significantly.

Additionally, during the reconsideration investigation, the subject firm provided the Department with the names of its four largest declining customers.

During the course of the original investigation, customer surveys were conducted for two firms which accounted for 68% percent of the decline in sales of the subject firm during the first four months of 2009. Those surveys revealed that one company did not import any like or directly competitive articles during the relevant period, while the other decreased its imports of like and directly competitive articles by 98 percent during the same period.

During the reconsideration investigation, the Department contacted a third company but did not survey the customer because of the relatively insignificant scale of the customer's decline. The fourth customer was the customer identified in the request for reconsideration. Because self check-out unit sales by the subject firm to this customer increased during the relevant period (as stated above) and the workers of the subject firm are separately identifiable by product line, the Department did not survey this customer.

Conclusion

After a careful review of information obtained during the reconsideration investigation and previously-submitted information, I affirm the original notice of negative determination of eligibility to apply for worker adjustment assistance for workers and former workers of Dawson Metal Company, Inc., Industrial Division, Jamestown, New York.

Signed in Washington, DC, this 7th day of October 2010.

Del Min Amy Chen,

Certifying Officer, Office of Trade Adjustment Assistance.