December 15, 2011, Introduced by Reps. Somerville, Heise, Cotter, McMillin, Cavanagh and Kowall and referred to the Committee on Local, Intergovernmental, and Regional Affairs.


     A bill to prohibit certain terms in public employment


contracts; to prohibit severance pay for voluntary termination of


employment; to limit contract terms and payments for early


termination of certain contracts; and to provide for civil fines.




     Sec. 1. This act shall be known and may be cited as the


"public employee severance pay regulation act".


     Sec. 2. As used in this act, "severance pay" means


compensation that is payable or paid upon the termination of


employment that is in addition to any wages earned or generally


applicable retirement benefit.


     Sec. 3. This state, a local unit of government, or any other


public employer in this state shall not include a provision in an


employment contract that provides for, and shall not pay, severance


pay to a public employee who voluntarily terminates public


employment, except in the following situations:


     (a) The employee meets the conditions to leave the employment


under a reduction-in-force plan or early retirement agreement that


includes a severance payment.


     (b) The employee qualifies for the payment under a general


policy adopted for employees in the state classified service or by


a merit system of a local unit of government.


     (c) The public employer initiates the not-for-cause




     Sec. 4. This state, a local unit of government, or any other


public employer in this state shall not pay severance pay under a


contract for services upon early termination of the contract, if


the early termination is instigated by the contractor. A contract


entered into on or after April 1, 2012 shall not provide for


payment of severance pay in violation of this act. This subsection


does not prohibit a contract term providing for or payment of a


bonus for early completion of a contract for the production of a




     Sec. 5. A public employee or officer who authorizes a contract


term or payment in violation of this act is responsible for a civil


fine of not more than $25,000.00. The attorney general or the


attorney for the local unit of government may bring an action in


the circuit court for a violation of this act. A civil fine


collected under this section shall be submitted to the state


treasurer for deposit in the general fund of this state.