Tear Gas Grenade is a ranged weapon that causes nearby targets to get stunned for a moment, the player will not be affected by the gas. When thrown, it will explode into a large yellow cloud.
The player used to be able to get Tear Gas Grenades during the early stages of We Happy Few's development, though it's since been removed as for the final release of the game.
The player can get the grenade through console commands.
By the looks of it, the tear gas grenade would have been used to craft Dick the Naughty Duck, as the icon and model for the Tear Gas Grenade is still present on the item.