A federal bankruptcy court in Delaware determined that Yellow Corp. is not responsible for the claims of approximately 22,000 union employees for not providing 60 days’ notice before the mass layoffs in the summer of 2023. It said the company was a “liquidating fiduciary” and not an employer at the time the layoffs were ordered, which released it from liability.
Yellow (OTC: YELLQ) determined on July 26, 2023, that it had no viable path forward and enacted a plan to shut down operations. It terminated non-union employees on July 28, 2023, and union employees were laid off two days later (July 30), the same day it permanently closed. Notices under the Worker Adjustment and Retraining Notification Act were provided to employees, but not 60 days in advance, as required by law. However, there are several exceptions that allow employers to shorten the notification period.
The liquidating fiduciary exception was one such defense applicable to Yellow.
The court said that Yellow demonstrated in a three-day trial in January that its final shipment was made on July 29, 2023, at 11:30 p.m. EST, and that after that point, it was no longer an employer, simply a fiduciary focused on winding down affairs and preparing to liquidate assets.
“In…
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