AUGUSTA, Maine — State officials from across the political spectrum are lining up on the side of more than 500 workers at the Verso paper mill in Bucksport, who are locked in a fight with the owner of the soon-to-be shuttered facility over severance packages worth up to $45 million.
It’s rare for Democrats and Republicans to be on the same side of a labor dispute, but top lawmakers from both parties — as well as Republican Gov. Paul LePage and Democratic Attorney General Janet Mills — are warning Verso that failure to pay severance packages by Jan. 8 could result in a lawsuit from the state.
This week, it was revealed that the mill was sold to American Iron & Metal, a Montreal-based firm, for about $60 million. Officials from that company have said it plans to demolish the mill and make the property available for redevelopment, according to Bucksport Town Manager Derek Goodine.
Verso announced its plan to close the mill in October. At the time, roughly 570 workers were employed there, but many have since stopped punching the time clock as the facility winds down. The last papermaking machine was shut down Sunday, but all the workers will be paid until Dec. 31, according to company officials.
State law requires that large companies like Verso pay severance packages equal to one week of wages for every year worked at the company to all its employees. That severance payment must be made within one pay period of the employee’s last full day of work.
The state’s Department of Labor has notified Verso that it interprets the law to mean the company must pay complete severance packages and back vacation pay by Jan. 8.
Top lawmakers also sent a letter to the company on Tuesday, urging Verso to follow the statute.
“The men and women at the Bucksport mill are losing their jobs. They earned they severance packages every day they showed up to work. Now is not that time to change the rules and further add to their hardship. State law is clear. We hope and expect your company to comply with it,” the letter stated.
The letter was signed by House Speaker Mark Eves, D-North Berwick, Senate President Mike Thibodeau, R-Winterport, House GOP leader Ken Fredette of Newport and Senate Democratic Leader Justin Alfond of Portland. It was also signed by Sen. Kim Rosen and Rep. Richard Campbell, both Republicans who represent Bucksport.
Bill Cohen, a spokesman for Verso, said Thursday that the company intended to follow the guidelines set in its collective bargaining agreements — the contracts negotiated between the company and the unions representing its workers.
All of those agreements outlined a severance delay of 90 days, meaning payments would be made around April 1.
“We think the language in the law is not quite as clear as some people would like it to be. What we are trying to do is continue to talk to our unions,” he said. “In the meantime, there have been some folks who have chosen, quite honestly, to make it a political issue. That’s their choice.”
Cohen said severance packages were the only remaining sticking point between Verso and the unions after negotiations related to the mill’s closure began two months ago.
But Emery Deabay, president of United Steelworkers Local 1188, which represents more than half of Verso’s workers in Bucksport, said negotiations about severance and vacation pay had stalled “since Day One.”
Deabay said he believes workers are actually owed severance as early as Dec. 23. The statute in question says workers must be paid severance within one pay period of their last full day of work. He said that while Verso’s employees may be receiving paychecks until the end of December, many won’t work a single day after Dec. 17.
Many of Verso’s employees have been with the company for decades, he said. Deabay has worked at the mill for 40 years. He said he didn’t want to see workers wait three months between their last paycheck and their severance package but he was not optimistic.
“What’s going to happen is what always happens: Workers are gonna lose and corporations are gonna win, because it’s going to go to litigation,” he said. “When it gets to the courts, we know what happens. It gets dragged out. The court case will take longer than past April.”
Julie Rabinowitz, spokeswoman for the Maine Department of Labor, said the state would move swiftly to force Verso to pay if it didn’t issue severance packages by Jan. 8. That’s because the state fears that with three additional months, Verso may make moves that would prevent it from having to pay at all.
State law says, for example, that companies that file for bankruptcy are not obligated to meet the legal requirement to pay severance.
“Our concern is that workers who go through the holiday season, go through the winter, go through the heating season, and expect a payment to be coming on April 1, something intervenes and now that payment doesn’t come,” she said.
Follow Mario Moretto on Twitter at @riocarmine.