ROARING SPRING, Pa. (From news reports) -- Major changes are coming to Appvion's Spring Mill.
"Last week Appvion and the (United Steelworkers) Local 10-422 reached an agreement to restructure the company's integrated pulp and paper mill in Roaring Spring, PA. The new agreement provides a framework for a more efficient and cost-effective operating structure while maintaining the current operating volumes at the facility," Wendy L. Melzer, Appvion vice president of human resources, said in an email.
In a letter sent to employees, Appvion said due to a market decline in the carbonless and security markets, it was faced with a need to restructure in "order to survive and prosper."
The restructuring agreement calls for a permanent reduction in the workforce at Spring Mill over the next several months. As part of this agreement, there will be a severance package offering for up to 50 employees based on seniority. The intent is to provide a bridge to those who are approaching retirement or would like to explore other opportunities, according to the letter.
"Appvion's decision to restructure is not uncommon for companies in which technology plays a more significant role," said Joe Hurd, president/CEO of the Blair County Chamber of Commerce. "It's great that the level of production will stay relatively the same. It's not so great that the decision adversely impacts employees. As the chamber and other workforce developers look for more ways to connect job seekers with available employment opportunities, we'll do our best to assist those who have gained marketable skills through their time at Appvion."
Meetings have been held by Local 10-422 to inform the membership of the details of the restructuring agreement.
Hourly employees will have the opportunity to sign up for severance packages until Nov. 1 with all staffing changes expected to be complete no later than March 31, 2020, the letter said.
Stephen McKnight, Altoona Blair County Development Corp. president/CEO, said in an email: "ABCD Corp. has been in touch with Appvion officials and updated on this restructuring. As we understand it, the steps they are taking are reflective of a changing market conditions and cost structures. We were informed this will not change the overall level of output at the Mill as new production methods and technologies are being incorporated. It is our hope that over the next few months those employees eligible for the severance arrangement can benefit and no additional reduction is needed."
In the letter sent to employees, Appvion said, "While this is a difficult process, the markets and businesses we participate in at Spring Mill make this necessary for the long-term survival of the operation. Our company's leadership believes in having the courage and accountability to make decisions in the best interests of our employees, business partners (USW), customers, and stakeholders. The company also expects to complete all changes, both salary and hourly, by March 31 and for the transition to be conducted according to our company values: safely and ethically, while maintaining service and quality levels that our customers expect, and while treating our people with the utmost dignity and respect," the letter said.
Mitchell Becker, president of United Steelworkers Local 10-0422, which represents the majority of the workers at the Roaring Spring mill did not return a call seeking comment.
Appleton, Wisc,-based Appvion had filed for bankruptcy in October 2017.
In June 2018, Appvion completed the sale of substantially all of the company's assets to a group of its lenders led by Franklin Advisers Inc.
The transaction was to significantly reduce Appvion's debt, provide additional liquidity and better position the company to compete long-term in the evolving specialty paper market. It also was to allow the company to further invest in the innovation that has made it a market leader, according to a company press release.
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