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Sterling Employment Law

Following mass layoff, workers sue for violation of WARN act

On March 12, Entertainment Publications, the publisher of the popular Entertainment coupon books, filed for bankruptcy. The Michigan company moved to liquidate its assets, listed at approximately $13.8 million to pay debts listed at approximately $52.1 million. At the same time, the company laid off more than 350 workers.

A group of those employees filed a class action suit, alleging an employment dispute. The Federal Worker Adjustment and Retraining Act requires employers to give employees at leave 60 days advance notice when laying off employees or to pay 60 days of wages and benefits. Employees claim they did not receive the required notice or benefits.

It was uncertain how the bankruptcy could affect the popular Entertainment books. However, other businesses have expressed interest in purchasing the company. Entertainment Publications will be auctioned on April 22. There is nothing in the law to ensure that laid off employees will be rehired following the auction if the buyer chooses to resume operations.

The purpose of the WARN act is give employees advance notice of mass layoffs, which gives them time to seek other employment. The statute applies to all businesses with at least 100 workers, not including part-time employees or those hired within the past six months. Workers who believe they have been laid off without notice, in violation of federal law, may benefit from speaking with an employment law attorney about their options. An attorney may be able to send a letter to the company, negotiate a settlement or file a lawsuit to ensure that workers get the wages and benefits to which they are entitled.

Source: Mlive.com, "Workers reportedly returning to Metro Detroit coupon book publisher that closed and filed for bankruptcy," David Muller, April 1, 2013

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