Bill Summary and Fact Sheet for An Act Relative to Plant Relocation

Bill Lead Sponsors: Senator Marc Pacheco, First Plymouth and Bristol

Bill Number: SB283

Bill Co-Sponsors:

General Law Affected:
Chapter 149
Deletes section 183 and 184
Creates a new 183

Current Law: 
In 1998, the Massachusetts Supreme Court struck the plant closing law for being unconstitutional.  As of now, employees have no protections against plant closings.

Proposed Law:
This act would provide severance for each employee of an "industrial, commercial or health care facility" with 100 or more employees.   The relocation must be more than 100 miles from the current facility.   For each employee with three or more years of service they will receive one-week severance for each year of service.  There are several exceptions, including exempting the company if the closing is caused by a physical calamity or if the employee accepts employment at the new location.

Rationale:
Over 22,000 workers between July 2003 and April 2005 have lost their jobs in Massachusetts alone due to layoffs and plant closings of 100 employees or more.  Many of these workers had no protection against these closings. Many of these companies relocated overseas for cheaper labor and larger profits.  While the CEO's still receive large packages (known as a "golden parachutes") and generous salaries, employees are left with nothing.  When Bradlees closed 150 stores in the Northeast region, 9,500 employees lost their jobs. Peter Thorner, then Bradlees' CEO, sought a $2.3 million dollar severance package for their executive officers not including the $6 million dollars Thorner sought for his work.

Workers affected by the relocating of their company have rights to reasonable severance pay.  One week's severance pay for each year of service as a ‘tin parachute' is a reasonable severance package.