Sappi lays off workers for a week while paper mill idles
Although news broke Tuesday that Sappi Fine Paper North America will temporarily idle its Cloquet paper mill later this month, United Steelworkers 11-63 President Dave Little isn't excessively worried about the eight-day layoff.
Although news broke Tuesday that Sappi Fine Paper North America will temporarily idle its Cloquet paper mill later this month, United Steelworkers 11-63 President Dave Little isn’t excessively worried about the eight-day layoff.
“This has happened before over the years,” said Little, adding that Sappi officials said the temporary layoff is to draw down its paper inventory as a result of decreased sales due to a strong American dollar and resulting soft sales abroad. “All indications are that this should be the end of it.”
At the same time, Little said he knows the layoff won’t be easy, even if it’s only eight days.
“It’s a big deal for a lot of people. A lot of folks live paycheck to paycheck,” he added.
Sappi employs about 730 people in Cloquet, according to the company website. Little said the layoffs affect 250 employees in two different unions - 211 USW members and 39 members of the maintenance union - on the paper side of the mill.
Sappi North America released a short official statement earlier this week:
“Due to global market conditions, Sappi North America's Cloquet paper mill will be taking one week of downtime later in July,” a company statement said. “The downtime will not have any impact on Sappi’s ability to supply coated paper to our customers, as we have ample production flexibility to meet their needs.
“The scheduled downtime in Cloquet is temporarily affecting approximately 250 employees and will last one rotation per affected employee, or four days, during this weeklong period.”
In an email to employees posted on the United Steelworkers Local 11-63 Facebook page, Cloquet mill manager Mike Schultz said the company had to make the layoffs to reduce inventory to the needed levels.
As to the prospect of additional layoffs, Schultz wrote, "Although this curtailment is expected to bring us back on our inventory curve, we can't project for certain what orders will be going forward. Our current order trend is not following historical references."
One of the 250 affected workers on the paper side, Little said he trusts the company’s explanation for the downtime.
“All those foreign countries that buy our paper aren’t buying it right now,” the union president said. “That’s the explanation they gave and I trust ’em. They (Sappi management) have been open and honest throughout this process.”
Little pointed out that laid-off workers can qualify for unemployment. They can also choose to use the eight days as paid vacation time.
There is a hitch to the unemployment option, however.
“If they sign up for unemployment, you have to put a ‘waiting week’ in,” he added, which means workers wouldn’t get pay for the week they are laid off. “Should there be future layoffs, however, they could start drawing immediately.”
The Cloquet mill produces pulp for both its paper production and for a new cellulose product that can be made into rayon for the textiles industry. In addition to Cloquet, South African-based Sappi has mills in Skowhegan and Westbrook in Maine and a North American headquarters in Boston.
Last year, Sappi eliminated 110 salaried and hourly positions at its North American operations, 27 of which were positions at the Cloquet mill that were vacant at the time.
The Duluth News Tribune contributed to this story.