June 6, 2002

JUNE 6, 2002

CONTACT: Gwendolyn D. Thomas, Assistant Attorney General
Michael Frett, Director, Bureau Of Labor Standards Maine Department Of Labor

The State today announced the settlement of a lawsuit against Vishay-Sprague over severance pay. The settlement results from ongoing cooperative discussions between the State and Vishay-Sprague. Under the settlement, Vishay-Sprague has agreed to pay more than $2.8 million in addition to the $1.7 million the company has already paid or will be paying to workers under the company's own severance pay policy. Maine law requires long-established, large employers to pay severance to laid-off workers employed three or more years based on a "one week's pay per year employed" formula after the employer substantially ceases operation of a facility. Payments to eligible workers will be made in lump sums within a few weeks of the Superior Court's final approval of the settlement.

Assistant Attorneys General Gwendolyn Thomas, William Laubenstein, and Elizabeth Wyman and Bureau of Labor Standards Director Michael Frett, Wage and Hour Division Director Anne Harriman, and Chief Labor and Safety Inspector Royal Bouchard worked on the case for the State.

Thomas said, "Maine's severance pay law recognizes the impact large-scale layoffs have on employees and local economies. We believe that this $2.8 million will go a long way toward easing the burden on both."

"We recognize the burden this lengthy process has placed on the laid-off Vishay-Sprague workers," Frett said, "This settlement is a conclusive showing that all matters coming under the Maine Severance Pay law will be fairly and vigorously pursued."