The Independent Counsel

Employment


Mass. "Tin Parachute" Law Voided


BY WILLIAM F. SWIGGART

The U.S. Court of Appeals for the First Circuit, in a case of first impression last fall, ruled unenforceable the 1990 Massachusetts Plant Closings Act (a/k/a the "Tin Parachute" law), which required any company operating a facility within the state employing 50 employees or more to pay a "reemployment assistance benefit" to employees terminated during a full or "partial" plant closing.

The court based its ruling upon the view that the mandated payments constituted "employee benefits" under the Employee Retirement Security Act ("ERISA"), and thus fell under that law's preemption.*


© ASSOCIATION OF INDEPENDENT GENERAL COUNSEL 1994; (all rights reserved). This article is not intended as legal advice. Consult a qualified attorney for assistance concerning a specific issue or problem.