LABOR: A Handshake Is Not Enough

A Handshake Is Not Enough

When the Fort Halifax Packing Co. shut down a poultry plant in Winslow, Me., in 1981, it refused to comply with a state law that required it to give most of its 125 employees severance of one week's pay for each year worked. The firm argued that only the Federal Government could regulate employee benefits.

In a 5-to-4 decision last week, the U.S. Supreme Court rejected that view. Upholding the Maine law and opening the way for others like it, the court drew a distinction between severance -- a one-time payment -- and the ongoing, company-managed benefits plans that are regulated...

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