Bank offers loans to end sit-in

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Bank of America has offered to extend loans to cover the severance and holiday pay of laid-off workers staging a sit-in at a factory in Illinois.

About 200 staff of Republic Doors and Windows have been occupying it since being laid-off with three days notice.

Their union said the protest would not end until details had been finalised.

The protesters had been supported by Illinois governor Rod Blagojevich, who was arrested on Tuesday on allegations of corruption.

Prosecutors said that he had been trying to sell the Senate seat vacated by Barack Obama to the highest bidder.

Halt business

If a US senator is unable to complete his or her term, the state's governor gets to name a replacement until the next Federal elections take place.

Mr Blagojevich was arrested on Tuesday on corruption allegations

The day before his arrest, Mr Blagojevich had threatened to stop the state of Illinois doing business with Bank of America if it did not help the laid-off workers at Republic.

The owners of the company had blamed Bank of America for cutting off their credit line.

Workers said they were entitled to be given 60 days notice of the closure of the plant and demanded pay for that period as well as any unused vacation time.

Republic Windows and Doors was a victim of the collapse in housebuilding in the US.

It said it had given its bankers a plan for an orderly wind-down that would have led to an end to production in January 2009.

But it said that the bank had rejected permission to give vacation pay to its employees.

It told workers last week that Bank of America had shut off its line of credit and refused to allow further expenditures.

But Bank of America laid the blame with the company, expressing concern at "Republic's failure to pay their employees the claims to which they are legally entitled".

It said that the loan would be enough to enable Republic to pay its laid-off workers, but there was no question of lending enough money to reopen the factory.