Chemtool employees say their severance pay will be less than other Lubrizol employees


Photo: Peavy J. Michael

Ever since a huge fire broke out on June 14 at the Chemtool plant in Rockton, sending smoke and debris for miles, employees have received full pay and benefits, as well as transition assistance that includes job placement services. On July 16, the company notified its employees, "Your employment with Chemtool will end on September 14, 2021." Anyone still working for Chemtool on that date will be eligible for severance benefits. Other benefits will continue until September 30.

The problem is that the severance benefits for Chemtool employees seem less favorable - by half - than the severance policy offered to other employees of Chemtool's parent company Lubrizol. The Transition Benefits Term Sheet given to Chemtool employees (see below) says:

If you have five or more years of service with Chemtool, you will receive one week of base pay for each year of service with a maximum of eight weeks.
if you have less than five years of service with Chemtool, you will receive two weeks of base pay.

Yet The Lubrizol Corporation Severance Pay Plan (effective 10/1/2020) (see attached) says that employees are eligible for:

A Severance Amount equal to two weeks of base pay for each year of service. The minimum Severance Amount is eight weeks of base pay, and the maximum Severance Amount is 52 weeks of base pay.
A Health Care Supplement of $200.00 for each week of base pay included in the calculation of your Severance Amount.

The 11-page Lubrizol document covers employees who have been "terminated due to poor performance, a restructuring, a reduction in our workforce or job elimination" However, it does excludes employees covered by another severance policy. Perhaps Chemtool's Transition Benefits Term Sheet is intended to supersede the Lubrizol policy, which doesn't apply to "persons who receive, or are entitled to receive, retention or similar payments under a plan, program or other arrangement of Lubrizol or a Lubrizol affiliate, unless the plan, program, or arrangement reserves the person’s eligibility for this plan."

To receive severance pay, Chemtool employees must sign an agreement "waiving all potential claims against Chemtool and its related entities."

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Lubrizol spokesperson Alicia Gauer did not answer questions from Roscoe News about the severance package, saying, "We will not comment on pay and benefits matters... . Those details would be discussed directly with employees."

A Chemtool employee, speaking on condition of anonymity, told Roscoe News that "Chemtool Incorporated" has been deleted as a "Participating Employer" in one version of The Lubrizol Corporation Severance Pay Plan listed under 2021 Lubrizol benefits on their website. And it's true - Chemtool doesn't appear on Page 11 of that version, but it does in a different version, both dated 10/1/2020.

According to the Chemtool employee, staff from Lubrizol's Human Resources told them they don't know why Chemtool wasn't offered the standard Lubrizol severance package. Employees say, "We have not gotten any answers from anyone" since early August, when Lubrizol distributed the revised severance policy without explanation. In meetings with Chemtool workers, Human Resources staff have mentioned but not emphasized the severance package. They want Chemtool employees to find new jobs before September 14, and those who do will be eligible for a $1,000 transition bonus.

The Chemtool employee confirmed that they are still receiving their full pay, as long as they come to work when assigned or use vacation time. They receive their daily assignments when they report to work. Their assigned schedule continues until September 14.

The employee revealed that some Chemtool colleagues also worked incognito with the Clean Harbors team as they cleaned up debris for Rockton residents. Chemtool paid them an extra $3 an hour if they volunteered for this job, but weren't allowed to wear anything that would identify them as Chemtool workers.

Residents have been speculating if and when the plant will reopen. But Lubrizol spokesperson Alicia Gauer told Roscoe News, "Given the near-term realities at the site, impacted employees will eventually need to move on, and we plan to provide appropriate severance when that time comes. "

Gauer said, "We will continue full pay through mid-September, as we have been since the day of the fire, and benefits through September 30." As of August 6, she said, "more than 30% of impacted employees have been placed in new opportunities within Lubrizol or with outside organizations." Outplacement services are provided by Lee Hecht Harrison. The company has given "resume and interview workshops to support all employees and will provide other tools and resources, such as computer access, to those who need it."

The Transition Benefits Term Sheet given to Chemtool employees says, "Years of service are calculated beginning in 2013 when Chemtool was incorporated. Years of service worked prior to 2013 are not included in the severance calculation."

According to the Chemtool website, Chemtool Incorporated was founded in 1963 and moved to Crystal Lake, IL in 1979. The Chemtool plant in Rockton was built in 2008. On August 30, 2013, Chemtool Incorporated was purchased by Lubrizol, a Berkshire Hathaway Company. Berkshire Hathaway is the multi-national holding company led by Warren Buffett, which also owns GEICO, Duracell, Dairy Queen, BNSF, Fruit of the Loom, Helzberg Diamonds, and Pampered Chef.

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