Search This Blog

Friday, August 9, 2013

VictoryLand a WARN Loser





Early this week the 11th Circuit Court of Appeals ruled that VictoryLand (Macon County Greyhound Park Inc.) did not satisfy a federal law that required the business to give statutory notice to its employees before two rounds of mass layoffs. The layoffs occurred after former Alabama Governor Bob Riley's crackdown on electronic bingo, back-and-forth legal proceedings over the legality of the game and the seizure by state regulators of bingo machines. The case is Myra Sides et al. v. Macon County Greyhound Park Inc.

VictoryLand asserted that because it took out billboard ads and made Internet postings that criticized the government's raids and suggested they were illegal put its employees on notice and fulfilled the spirit of the Worker Adjustment and Retraining Notification Act (WARN). The 11th Circuit was unconvinced finding VictoryLand liable for violating WARN because it failed to give proper notice to its employees of layoffs in February and August 2010, when the casino closed its doors in anticipation of a looming raid by state regulators. VictoryLand did not provide any formal notice under the WARN Act to employees.

VictoryLand employees filed a WARN class action complaint in Oct. 2010 and won class certification in March 2012. The United States District Court then granted summary judgment to the employees on liability for the WARN Act violations. VictoryLand’s potential liability according to the WARN class action attorney is roughly $3 to $5 million to 1000-1200 employees.
                                                                                                           
Common Sense Counsel: The WARN Act was created in part so that employers with at least 100 employees taking action that will adversely affect 50 or more employees would be statutorily required to provide adequate notice of future layoffs to all employees before ordering a mass layoff or plant closing. Under WARN “[a]n employer shall not order a plant closing or mass layoff until the end of a 60-day period after the employer serves written notice of such an order.” 29 U.S.C. § 2102(a).

The regulations implementing WARN require that notice should be “specific” and include: (1) a statement regarding the temporary or permanent nature of the layoff; (2) the expected date of the mass layoff or plant closing; (3) information on “bumping rights”; and (4) the “name and telephone number of a company official to contact for further information. WARN does contain an “unforeseeable business circumstances” defense where closure is not reasonably foreseeable as of the time that notice would have been required. The 11th Circuit is giving notice to employers that they are going to be held to the clear statutory language of the WARN Act. Employers not heeding the message will also find their company the biggest looser.

-----------------------------------------------------
Tommy Eden is a Lee County native, an attorney with the local office of Constangy, Brooks & Smith, LLP and a member of the ABA Section of Labor and Employment Law and serves on the Board of Directors for the East Alabama SHRM Chapter. He can be contacted at teden@constangy.com or 334-246-2901. Blog at www.alabamaatwork.com

 

Click below to complete an intake questionaire to receive a proposal to update or develop your Alabama Employee Handbook: https://docs.google.com/forms/d/1BAirnmNg6V9tAyIJFifkrbicJK8-PxncVBR94cZ6jy4/viewform