Carol Anstett was a salaried, at-will employee of the Plastics Division of Eagle-Picher Industries, Inc. The Plastics

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Carol Anstett was a salaried, at-will employee of the Plastics Division of Eagle-Picher Industries, Inc. The Plastics Division had an express severance policy under which “salaried employees terminated other than for cause or voluntary separation” were entitled to certain benefits. In July 1997, Eagle-Picher sold the Plastics Division to Cambridge Industries, Inc. Eagle-Picher notified the Plastics Division employees of what was happening to their health insurance and retirement benefits on “termination of service.” Cambridge immediately reemployed nearly all of the Plastics Division personnel, including Anstett. The employees believed that the sale of the division triggered an application of the severance policy and asked Eagle-Picher to pay. The company refused, claiming that the employees had not been terminated. Anstett and others filed a suit in a federal district court against Eagle-Picher, seeking the separation benefits. Eagle-Picher responded that the policy was intended only to cover employees who suffered a loss of income, not to cover a corporate asset sale in which the purchaser immediately rehired the employees. How should the court rule? Explain.

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Business Law Text and Cases

ISBN: 978-0324655223

11th Edition

Authors: Kenneth W. Clarkson, Roger LeRoy Miller, Gaylord A. Jentz, F

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