Severance for Plant Closure

Tnvols

Anyone have any experience with severance plan for union hourly?

morrisg

I assume you labor contract has a requirement to pay severance pay. If it's not included as part of the negotiated labor contract, then it is not considered a right or provision under your labor agreement. If you are in contract negotiations it would be a negotiable item. I'm not suggesting that you pay them nothing just because it's not in the contract, just a point.

I hope this plan helps:

SEVERANCE PAY PLAN
The Severance Pay Plan is designed to assist employees whose earnings are unexpectedly canceled by layoff due to a reduction-in-force.

WHO IS ELIGIBLE FOR THE SEVERANCE PAY PLAN?
Active Employees:
All regular employees who work at least 20 hours per week are eligible for the severance pay plan on the first day of active employment. Employees who are on a temporary appointment or a leave of absence are not eligible for this plan.

ENROLLMENT
If you are eligible for the Severance Pay Plan, you do not need to enroll.

SEVERANCE PAY PLAN COVERAGE
Benefits Provided
For active employees who are not members of the USW union the plan provides the following benefits, subject to the maximum benefits provision, based on base pay and continuous service for a reduction-in-force.

Years of Continuous Service Severance Benefit
• First 10 years 1 week of base pay for each year of
continuous Service
• Over 10 years through 1 1/2 weeks of base pay for each year of
15 years continuous service over 10 and through 15 years
• Over 15 years 2 weeks of base pay for each year of continuous service over 15 years
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Payment of Benefits
Severance benefits will be paid in either one or two lump sum payments. If payment of the severance benefit plus compensation for unused vacation would cause an employee to receive an amount in excess of one year’s base pay during the calendar year, that portion of vacation and/or severance which causes the excess is deferred for payment during January of the following calendar year.

Recall to Work
If an employee is recalled to work before the end of the period for which severance pay was received, the amount of overpayment will be considered an advance of future earnings.

Exclusions
The Severance Pay Plan does not provide benefits to employees who voluntarily terminate because of resignation, retirement, disability, death, or for cause.
Questions about the Plan
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MISCELLANEOUS
Base Pay
Base Pay for the purpose of the severance pay plan means your annual full-time equivalent basic rate of pay, before any salary reductions. It does not include overtime, bonuses, or any other compensation.

Continuous Service
• Continuous Service means service from your most recent hire date. Service performed prior to a break in employment is not included in continuous service.

• Employees with less than one year of Continuous Service will be credited with a full year’s service for the purpose of this plan.
• If an employee was previously laid off with severance benefits, service
used in the prior calculation will not be included for the purpose of another
layoff.
• Continuous service will be reduced by time spent on approved leave of
absence or in any employment category ineligible for severance benefits, such
as part-time employment of less than 20 hours per week.

Part-Time Employees
Severance benefits for eligible part-time employees, or employees whose
Continuous Service contains periods of eligible part-time employment, will
be prorated in accordance with the employee’s official work schedule for the
period of part-time employment.

Termination of Coverage
Severance Pay Plan coverage will cease when an employee is no longer in business.