Yellow resolves class action lawsuits related to delayed WARN filings
Yellow Corp. faced legal challenges following its abrupt closure in July 2024, with two class-action lawsuits seeking compensation for employees affected by the shutdown. A bankruptcy judge had previously ruled that Yellow failed to provide adequate notice to its workforce, prompting legal action from both non-union and union workers.
The settlements, reached a month after the judge’s decision, saw approximately 3,500 employees, both union and non-union, agree to undisclosed compensation amounts. The majority of non-union employees had already signed severance agreements, releasing Yellow from further liabilities. Claims from the lawsuits totaled over $240 million, highlighting the magnitude of the grievances brought against the trucking company.
The legal battles stemmed from allegations of Yellow’s failure to comply with Worker Adjustment and Retraining Notification (WARN) Act regulations. Employees claimed that they were not given the required notice before mass layoffs occurred. Most non-union workers were terminated on July 28, 2023, mere days before Yellow’s closure, leaving them in a precarious situation.
As the legal proceedings unfolded, Yellow faced additional challenges with the sale of some of its terminals. Four properties were acquired by trucking companies R+L Carriers and Central Transport for $56.5 million, further signaling the company’s struggles in the aftermath of its closure.
The lawsuits brought to light the complexities surrounding employee rights and the responsibilities of companies in times of financial distress. The settlements, though undisclosed, provided some form of relief to the affected workers, many of whom were caught off guard by Yellow’s sudden shutdown. The legal battles serve as a reminder of the importance of adhering to labor laws and providing adequate notice to employees in termination scenarios.
Overall, the settlements and legal proceedings shed light on the challenges faced by employees in the aftermath of corporate closures, emphasizing the need for companies to adhere to legal obligations and prioritize the well-being of their workforce. The resolution of the class-action lawsuits marked a step towards closure for the affected employees, albeit against the backdrop of a tumultuous period following Yellow’s closure.
