Dive Brief:
- ITT Educational Services Inc. made headlines when it abruptly closed the doors of ITT Technical Institute earlier this week, but that won't be the final chapter. A pair of employees laid off by the parent company of the school are suing the parent company for violating federal law by not providing 60 days' notice, according to the Indianapolis Business Journal.
- The employees, Allen Federman, a business analyst at ITT Educational Services Inc.'s Carmel, Ind., headquarters, and Steve Ryan, an instructor at two ITT Technical Institute locations in Calif., filed almost immediately Tuesday in U.S. District Court in Delaware, the Business Journal reports..
- And while there are only two named plaintiffs, they are looking for class-action status on behalf of all 8,000 employees who lost jobs as a result 130 ITT Technical Institute campuses in 38 states closing down, according to the Business Journal.
Dive Insight:
Whether or not this lawsuit gets traction in the courts, there is a federal law (and a myriad of state laws, as well) that requires 60-day notice. The federal Worker Adjustment and Retraining Notification Act (WARN) requires larger employers to give employees notice 60 days before an impending plant closing or mass layoff that will result in job losses for a specific number or percentage of employees. There are exceptions. For example, if business circumstances weren't reasonably foreseeable 60 days in advance, then the law may not apply. That may be the case here, though it's up to the courts to decide.
Some employers have tried to dodge the 60-day notice law by saying the layoffs were for performance reasons, but those arguments rarely pass muster.
