Continental proposes severance package for Mayfield employees

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Continental Tire North America Inc. (CTNA) recently presented the United Steelworkers of America and AFL-CIO with what it considers "a generous severance package proposal" for employees laid off as a result of indefinite suspension of tire production at the Mayfield, Ky., plant.

"We realize that these layoffs will create a hardship for many of our employees," says Nick Fletcher, vice president of human resources. "To assist our employees during this difficult time, Continental Tire is offering generous severance and transition assistance so that our employees can get through this difficult time."

CTNA announced its decision to indefinitely suspend tire production at the Mayfield plant on June 29, 2004. The company has been in negotiations with the Steelworkers union since Sept. 3, 2004, discussing the Mayfield layoffs.

In these negotiations, the parties discussed the order and timing of layoffs, the configuration of mixing and warehouse operations after tire production is suspended as well as benefits for displaced workers.

CTNA says its comprehensive proposal provides for substantial lump sum severance payments for laid off Mayfield employees based upon years of service. The most senior employees would be eligible for lump sum severance payments of up to $8,000.

The proposal also offers preferential hiring rights for laid off Mayfield employees at other CTNA plants.

In addition, the proposal would create a special transition assistance fund for the benefit of laid off employees. The company has offered more than $1.1 million for the transition assistance fund that could be used to assist laid off employees with outplacement assistance, job retraining, health care costs, relocation assistance or other transition expenses.

The proposal also includes an agreement to rehire laid off employees if tire production resumes at the Mayfield plant.

"We believe that the Continental Tire has made a generous offer to assist our employees during this difficult transition," says Fletcher. "We hope that the union will seriously consider this offer so that we can quickly come to an agreement that will benefit our Mayfield employees."

CTNA and the union will continue negotiations on November 18-19, 2004. The company says it is confident that an agreement can be reached to ease the transition for employees adversely affected by the suspension of tire production at the plant.

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