March 29, 2024
Business

Ruling could benefit former mill employees

PORTLAND – A federal court ruling Wednesday could lead to additional severance pay for unionized workers who lost their jobs at the Carleton Woolen Mills in Winthrop and Gardiner.

About 350 workers represented by the Paper, Allied-Industrial, Chemical and Energy Workers International Union are seeking nearly $1 million from Allied Textile Companies, the British corporation that bought Carleton in 1994.

Carleton, which ceased operations in 2000, has sought protection under Chapter 11 of the bankruptcy code. A bankruptcy judge dismissed the union’s severance claims, prompting an appeal to U.S. District Court.

District Judge Gene Carter ruled Wednesday that the bankruptcy court should have applied a 1999 state law to the claims of first- and second-shift workers and that the lower court should reconsider claims of third-shift workers.

Workers whose collective bargaining agreement included a severance pay provision had been barred from making a claim under the state’s severance statute.

But under the 1999 amendment, labor contracts precluded workers from making claims only if the severance pay agreement was equal to or greater than the state’s, said Jonathan S. R. Beal, an attorney representing the union workers.

Carter’s ruling said the newer version of the law should apply because Carleton’s closing and the mass layoff of workers happened after the law was amended.

Beal said the net effect is that all the union claims have been revived. “This is a very, very good victory for the workers,” Beal said Wednesday.

The case now goes back to bankruptcy court.


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