Maine Severance Pay laws & compensation compliance analysis

Maine Severance Pay: What you need to know

Any employer who relocates or terminates employees because of a relocation or plant closing is liable to the employee for 1 week's pay for each year of employment at the establishment regardless of prior ownership of the establishment. The severance pay to eligible employees must be in addition to any final wage payment to the employee and must be paid within 1 regular pay period after the employee's last full day of work. New regulations clarify the operation of this requirement (ME Rule 12-170-15).
Calculation of severance pay. The years worked are to be calculated from the most recent date of hire or date of rehire, in case of a break in employment, to the last date the eligible employee worked at the covered establishment. The employer may reduce the severance pay only by any voluntary and unconditional payments made to the eligible employee, except that premiums or bonuses offered to encourage employees to maintain employment through the termination or relocation period may not be used to reduce the severance pay. The employer may reduce the severance pay by any payments made under a contract that provides for severance pay.
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Employers are not liable for severance pay if he relocation or termination was the result of a physical calamity, such as fire, flood, or other natural disaster, or the final order of any federal, state, or local governmental agency, including adjudicated bankruptcy
Employee eligibility requirements. To be eligible for severance pay for the termination or relocation of a covered establishment, an employee:
· Must have worked at the establishment at some time during the 12-month period before the date of termination or relocation
Must not be covered by an express contract providing for ...

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