Plant Closings: Information on Advance Notice and Assistance to Dislocated Workers

U.S. Government Accountability Office

Plant Closings:

Information on Advance Notice and Assistance to Dislocated Workers

HRD-87-86BR: Published: Apr 17, 1987. Publicly Released: May 4, 1987.

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Pursuant to a congressional request, GAO provided information on the extent of assistance and advance notice provided to workers dislocated as the result of plant closings and permanent layoffs.

GAO estimated that 16,200 businesses with 50 or more employees either closed or had a permanent layoff, resulting in the dislocation of 1.3 million workers during 1983 and 1984. GAO found that: (1) most of the businesses with over 100 employees reported that they provided 14 or fewer days of advance notice; (2) about one-third of the businesses reported that they provided no advance notice; (3) the median notice for blue-collar employees was 7 days, while the median notice for white-collar workers was 14 days; and (4) more businesses without union representation provided no notice than did businesses having some union representation. In addition, GAO found that: (1) less than 30 percent of the businesses with 100 or more employees provided both financial and reemployment assistance to dislocated employees; (2) the most common forms of assistance were severance pay, continuation of insurance benefits, and reemployment assistance; (3) over half of the businesses offered severance pay to white-collar employees, but only 37 percent offered severance pay to blue-collar employees; (4) about one-third of the businesses offered reemployment assistance; and (5) businesses that provided more notice were more likely to provide financial or reemployment assistance.