April 04, 2020

House passes bill to plug severance pay `loophole’

AUGUSTA — Maine employers would no longer be allowed to negotiate severance pay packages that do not meet the state’s minimum standard, if a bill that received final House approval Thursday becomes law.

State law requires companies with 100 or more workers that close or leave the state to give a week’s pay for each year worked to those on the payroll for at least three years.

But organized labor leaders say a loophole has allowed employers that closed down to negotiate severance packages smaller than what state law stipulates.

The Maine AFL-CIO said workers have had to negotiate at a disadvantage because of the way the law is written. The bill faced a final Senate vote.

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