Armstrong, Union Agree on Severance

Lancaster, PA, February 1--Armstrong World Industries is keeping its word to its employees who are losing their jobs, according to the Lancaster New Era. The newspaper reported that Armstrong and unions at the company’s Lancaster floor plant have negotiated severance and early retirements for the 420 hourly workers there whose jobs are being eliminated. Though the plant has seen waves of layoffs over the past decade, this is the first time since 1998 that acceptable "separation packages" have been negotiated, union leaders said. The packages could pay some idled workers about $20,000 to $30,000 in severance, they indicated. With the earlier rounds of cutbacks, union leaders sought packages from management, to no avail. Once, in 2001, a package was offered, but the unions rejected it because it was tied to major concessions on overtime, work schedules and other issues. But when Armstrong announced the new round of cuts in November, due to the shift of commercial-floor production elsewhere, it promised to work out compensation with the unions. An Armstrong spokeswoman could not be reached by press time to explain the change in thinking. Union leaders, however, attributed the new stance to Armstrong chief executive officer Mike Lockhart. "(Lockhart) realizes that they're long-service employees and he wanted to be fair," said Jerry Eshleman, president of Local 285 of the United Steelworkers, which represents the plant's production workers. Tony Purcell, president of Lodge 928 of the International Association of Machinists & Aerospace Workers, which represents the plant's industrial maintenance workers, said, "He knows these people will have a hard time finding a comparable job at their age and he understands the impact on the community." The 500-member Local 285 approved the package Jan. 16 by an "overwhelming" margin, said Eshleman. Lodge 928's 111 members approved the package, as well as a new four-year contract, on Dec. 19 by a five-to-one margin, said Purcell. Eshleman said Local 285 was happy to receive packages for the new round of idled workers. But "it should have been better," he said, given the seven-figure packages that executives received upon leaving Armstrong after just a few years of service. Eshleman also expressed sadness that hourly employees laid off in earlier rounds of cutbacks got no severance, while idled salaried employees did. The union leader noted that the layoffs "devastate" not only the worker and his family, but also the community, by triggering reduced consumer spending and lower tax revenues. "It's a satisfactory package," said Purcell. "But if you're losing your job, nothing can compensate you for that." The job eliminations will leave 250 workers at the plant, less than a tenth of its work force 30 years ago. The facility will make only residential flooring. Here are the kinds of packages available to Local 285 members during the new round of downsizing, which runs through May 2006. Workers who retire with the so-called "Rule of 90" (at least age 55 plus enough years of service to add up to 90) not only get their full pension and retiree medical coverage, but also severance of $800 per year of service. Workers who turn 54 during this downsizing can retire at that time with full pensions and retiree medical coverage, but no severance. Workers younger than 54 who leave voluntarily or are laid off can get severance of $1,200 per year of service, plus medical coverage for one year. Workers who are laid off can spurn the severance but retain recall rights as they seek work at another Armstrong location. Packages for Lodge 928 members are similar. Workers who fulfill the "Rule of 90" can retire with full pension, retiree medical coverage and severance of $1,000 per year of service.