The CEO of a company that is closing its manufacturing plant in Scarborough said Tuesday afternoon that employees will receive one week of severance pay, which is a change from what local management had told workers last week but still could conflict with Maine labor law.

Doug Folsom said each of Whitcraft’s 125 full-time employees in Scarborough would be paid through the end of this week, and continue to receive health insurance benefits through this week. About 40 of those employees will continue to work on closing the facility over the next three months, and receive the one-week severance when their employment ends.

“Paperwork went out to their homes (Tuesday),” Folsom said. “It’s an unfortunate situation. I would love to do more, but we’re just not in a situation to do that. Unfortunately, we’ve had to do mass layoffs (at two other Whitcraft facilities) outside of Scarborough.”

Whitcraft manufactured commercial airline engine components and was hit hard by the economic slowdown caused by the coronavirus pandemic.

The Maine Department of Labor received notice from Whitcraft on Friday about the mass layoffs under provisions of the federal WARN Act. Normally, Maine requires a 90-day notice before such an event or plant closure, and affected employees are due a week’s severance pay for every year worked for that establishment.

Folsom argued Tuesday that Whitcraft is not liable for any severance because it purchased the plant slightly less than a year before announcing the layoffs. Under state law, a covered establishment is defined as any industrial or commercial facility that employs “or has employed at any time in the preceding 12-month period” at least 100 workers.

The section of the statute that waives liability for severance pay outlines two possibilities that may apply. First, that the closing happens because of “a physical calamity” – the Maine Department of Labor has yet to determine whether the coronavirus pandemic qualifies as one. Second, that “the employee has been employed by the employer for less than three years.”

“Unfortunately, we are not able to pay for years of service they gave to another company,” said Folsom, who described the one-week severance package as “the right thing to do.”

He said the extra week of pay and benefits will help laid-off employees transition into unemployment benefits and COBRA health insurance. He also said a few local companies have inquired about hiring some of the affected workers “and we directed them to our employee list.”

Brent King, who spent 34 years at the plant that originated in Windham as Rich Tool & Die Company, said he still has not received any written notification from the company, only from the state of Maine about Whitcraft’s intent to close.

“I was hoping they would meet us at least halfway on years of service,” King said. “One week versus 34 weeks, that’s a big difference.”

King said there has never been union representation among the workforce. Shortly before Whitcraft bought the company, previous owner LAI reduced benefit packages, King said, resulting in the loss of two weeks of his annual vacation time.

“We tried to negotiate with Whitcraft,” King said. “They said, ‘We’re not in the business of giving back.’ That’s a quote from Doug Folsom.”

King said over the years the plant has done a wide variety of manufacturing, and believes Whitcraft could have pivoted from its singular focus on commercial airline engine components. He understands there isn’t much demand for such products today, with restricted travel amid a global pandemic.

“A lot of companies, you switch gears,” he said. “They didn’t even attempt that. I guess that’s what’s really disappointing.”

Chad Harrill, who worked nearly seven years at the plant, said he suspects the delayed offer of severance may be a result of negative reaction from news of the abrupt lay-off notice.

“First off, I find it funny that I’m hearing about it from a newspaper reporter,” he said. “My personal opinion, I think he’s doing this to save face. Sure, it’s nice that they’re doing something, but it’s kind of insulting, especially for guys who have worked there for 40 years.”

Dave Currier had received a promotion to second shift supervisor less than a month before furloughs began on March 18 due to a sudden drop in orders. He said he was told on April 29 that health insurance would run out the following day and no severance would be forthcoming.

He wondered how a change of ownership could result in Whitcraft avoiding liability for the more generous severance pay spelled out in Maine labor law.

“If this happened and LAI still owned us,” he said, “it sounds like they would have been required to pay severance.”

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