The abrupt closure by Excel Capital Partners LLC of its entire storage business has landed the company in court, where it faces a putative class action from hundreds of employees alleging violations of the Worker Adjustment and Retraining Notification Act.
Excel, which on Sept. 17 told all employees of subsidiary Excel Storage Products LP that they were out of a job, should have prepped affected parties with 60 days’ notice pursuant to the WARN Act, according to a suit filed Friday in the U.S. District Court for the Western District of Pennsylvania.
Steubenville, Ohio-based Excel, a private equity group that operates companies in various industries, announced the sudden closure of all three of its Excel Storage plants, notifying between 400 and 800 employees that their work had ended and that their health benefits would expire at the end of September, the complaint argues.
An attorney for the plaintiffs said the news was sudden and came as a surprise to employees. He pointed to an upcoming hearing to determine whether the company would go into receivership.
That’s the next step in the process, is seeing whether they’ll end up in receivership, and then we’ll go from there, ” Outten & Golden LLP’s Jack A. Raisner told Law360 on Monday.
Raisner and his Outten colleague Rene S. Roupinian, along with Stember Feinstein Doyle Payne & Cordes LLC’s Samuel J. Cordes, filed the complaint for the proposed class, which would include all WARN-eligible terminated employees.
The plaintiffs are seeking 60 days of benefits, including wages, salary, commissions, bonuses, accrued holiday and vacation pay, and 401(k) contributions.
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Under WARN, companies with more than 100 employees must provide 60 days’ notice before closing plants or laying off 33 percent or more of a plant’s workers, assuming that number is higher than 50 employees.
The plaintiffs say the current matter more than meets those thresholds.
Lead plaintiff Ruth Blackburn, vice president of administration at Excel Storage’s Cadiz, Ohio, facility, was one of 74 Cadiz employees to lose a job, while 150 employees are out of work at Excel Storage’s East Stroudburg, Pa., headquarters, according to the complaint.
The defendants also closed a Lodi, Calif., facility, according to Raisner.
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The plaintiffs are represented by Outten & Golden LLP and Stember Feinstein Doyle Payne & Cordes LLC.
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The case is Blackburn et al. v. Excel Capital Partners LLC et al., case number 2:10-cv-1261, in the U.S. District Court for the Western District of Pennsylvania.http://employment.law360.com//articles/196546