Unilever to shut Alberto-Culver’s Melrose Park plant, offices [Chicago Tribune]

Dec. 02--Only months after its acquisition of longtime Chicago-area manufacturing stalwart Alberto-Culver Co., Unilever PLC is plotting the orderly shutdown of the Melrose Park facility, the loss of more than 600 local jobs and the transfer of work to faraway states where plant expansions are already underway.

Unilever confirmed Friday that in 2013 it would close the Melrose Park offices and plant that produces personal care brands TRESemme and Nexxus shampoos and conditioners and St. Ives lotions and body washes. Unilever, which paid $3.7 billion in cash for Alberto-Culver, attributed its decision both to operating efficiencies and to one of the Justice Department's requirements for the merger.

In order to receive regulatory approval for the deal, Unilever had to divest the Alberto VO5 brand in the United States and Puerto Rico and the Rave brand globally. It completed sales of those units in August.

"(VO5) was one of the main production lines at the Melrose Park manufacturing facility, and we can confirm that this requirement was a factor in our decision," Unilever spokesman Anita Larsen said in an email.

Community representatives who say they met with Unilever almost a year ago believe the company's intent was always to shutter the plant, which has operated since 1961.

Illinois Rep. Angelo "Skip" Saviano said he and other officials met with Unilever months ago to gauge its interest in retaining the company and jobs, and to see what assistance could be offered. The meeting, he said, was just a formality and Unilever's mind was made up.

"I just think Unilever bought them with the intention of moving them out," he said. "We had everybody trying to see what they could offer them. But I think it was all predetermined when they took over the company."

Added Melrose Park Mayor Ron Serpico, "The thing we always had in our corner was that the original family owned it."

Begun in the mid-1950s by Leonard and Bernice Lavin, the company's net sales had grown to $1.6 billion in 2010 and employment at the Melrose Park corporate headquarters and plant totaled about 870 when Unilever's acquisition of the company was announced last year.

Today, employment at the corporate offices and plant stands are about 600. That includes, according to the company, 200 union workers. Steelworkers Local 9777 says it represents 250 employees there, including many who started working at the plant right out of high school, met their spouses there and remain there today, now waiting for their production line to transfer and their jobs to be eliminated.

Unilver's purchase of Alberto-Culver closed in May. By mid-summer, Steve Kramer, Local 9777 vice president, said the company was meeting with the union to explain the economic argument for shutting down the plant.

"We asked what we could do to help with their decision not to move," he said. "They just kept giving us documentation. We asked them about the taxes, the cost of transportation. They said in their calculations, taxes were not an issue. The bottom line is they're saving a few pennies in every bottle of shampoo and hand lotion."

Production will be transitioned from Melrose Park throughout 2012, Larsen said. According to Kramer, layoffs will be based on a combination of seniority and skill level, and the first 20 or 40 may occur during the year's first quarter. The last employees to leave, Kramer said, will be the maintenance, loading and shipping workers because he has been told that Unilever is taking all the production equipment with them.

Production employees will be phased out as factories in Arkansas, Missouri and North Carolina, can duplicate the product formulas.

"Obviously, they're going for the non-union states," said Kramer, noting that union employees at Melrose Park make an average hourly wage of $17 to $18.

Two of those three plants have received stimulus packages to offset Unilever's plant investments.

In the spring, North Carolina announced that it gave Unilever a $195,000 grant that would help the company undertake a $35 million expansion of its Raeford plant and create 65 jobs. The plant makes deodorants, body washes and shampoos.

And in late October, Unilever announced a $40 million expansion and plans to hire another 125 workers at the former Alberto-Culver plant in Jonesboro, Ark. That facility, which opened in 2008, produces TRESemme, Nexxus, Motions and St. Ives products. To facilitate the expansion, Unilever negotiated incentives with the state that include a cash rebate equivalent to 3.9 percent of new payroll for a decade and additional sales and use tax credits.

Larsen said hourly and salaried employees will be eligible for severance and outplacement services. According to the shutdown package negotiated by the Steelworkers, union workers will receive 1 1/2 weeks of severance pay for every year of service, or up to 28 weeks of pay, a six-month extension of health insurance benefits, GED classes, job assistance programs and a letter of recommendation for each employee.

Still, finding manufacturing jobs in a community -- and an economy -- that continues to transition toward an retail and service sector is expected to be difficult.

"I've got two feelings," Kramer said. "This is just another corporation taking advantage of being able to dictate where they're going to move. And the other is they did negotiate with us fairly and respectfully and give us more than the contract. At the end of the day, the community will be without jobs."

"Those employees who have a little bit of skill, like maintenance or a machine operator, will have a better opportunity," he said. "Those who are just on the line stacking and packing, those people will be very hard-pressed to get a job that will even come close to what they had."

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