Lincoln paper mill layoffs due to contract lost to Indonesian firm, not just boiler explosion

Lincoln Paper and Tissue LLC announced Dec. 11 that it will furlough about 200 people.
Lincoln Paper and Tissue LLC announced Dec. 11 that it will furlough about 200 people. Buy Photo
Posted Dec. 17, 2013, at 3:37 p.m.
Last modified Dec. 17, 2013, at 6:15 p.m.
Millworkers arrive for a meeting at the Waterfront Event Center in Lincoln on Dec. 12. Lincoln Paper and Tissue LLC announced Dec. 11 the it will furlough about 200 people.
Millworkers arrive for a meeting at the Waterfront Event Center in Lincoln on Dec. 12. Lincoln Paper and Tissue LLC announced Dec. 11 the it will furlough about 200 people. Buy Photo

LINCOLN, Maine — Lincoln Paper & Tissue has revealed in a federal document that it was more than a boiler explosion that led to the recent decision to lay off 200 millworkers — the loss of a major customer also influenced the decision.

The company on Dec. 16 filed a petition with the U.S. Department of Labor to request that the 200 affected workers be eligible for Trade Adjustment Assistance, which is a federal program that provides job retraining and employment services for workers laid off due to foreign competition. William Peterson, the mill’s vice president of human resources, filed the petition.

The mill announced in early December that it would lay off 200 workers for an “indefinite” period of time. At the time, CEO Keith Van Scotter said the layoffs were because of an explosion on Nov. 2 that destroyed a recovery boiler in the mill. The mill shut down temporarily, but soon resumed operations. However, the mill said it would not immediately repair or replace the boiler.

In the federal petition for job retraining services, Peterson doesn’t mention a boiler explosion. Instead, in answer to why the layoffs were due to foreign competition, Peterson reveals that the mill has lost a major customer.

“We received notification that our largest tissue customer was moving their production needs to Indonesia and would no longer purchase tissue from us. They consumed approximately 50 percent of the operating capacity of our largest tissue machine,” Peterson wrote in the petition.

The petition lists the “worker separation date” as Thursday, Dec. 19.

Reached on his cellphone Tuesday afternoon, Van Scotter confirmed the mill applied for the TAA program but declined to comment further. Peterson did not respond to a message left at his office.

Maine’s paper industry, which has faced significant competition from foreign competitors, has used the TAA program in the past to help laid-off workers transition to other jobs.

U.S. Sens. Susan Collins and Angus King sent a letter on Tuesday to U.S. Secretary of Labor Thomas Perez urging him to approve Lincoln Paper & Tissue’s petition.

In the letter, they wrote that the job losses would strike a “devastating blow” to the region and that, given the rural location and general state of the pulp and paper industry, “the likelihood of displaced workers finding comparable positions is remote.”

“TAA assistance is critical to helping workers who have been subjected to layoffs obtain the training and resources they need to pursue alternative job opportunities,” Collins and King said in a joint statement. “These dedicated workers, many of whom have worked at the facility throughout their entire careers, lost their jobs as a result of increased imports and foreign competition. In this difficult economic time, we will continue to work together to support the Mainers impacted by this layoff and ensure that they receive the assistance and resources they need.”

If the mill’s TAA petition is approved, laid-off workers will be eligible for benefits and services including job training, job search and relocation allowances, income support and assistance with health care premium costs, according to the U.S. Department of Labor’s website.

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