The incident happened as the ex-employees and their families stopped a truck taking out scrap from the premises of closed Ashok Paper Mill last night, DIG, Police, Darbhanga Sudhanshu Kumar said.
The police first tried to persuade the mob, but resorted to lathicharge as the angry people pelted stones, he said.
Additional police forces have been deployed in the town in view of the prevailing tense situation.
Deputy Superintendent of Police (DSP), Sadar, Neeraj Kumar is camping near the mill premises where a large crowd gathered this morning too, he said.
The youth's body has been handed over to his family for cremation, Kumar said adding the injured were admitted to hospital.