Workers suing Patriot National over layoffs

Claim: Severance pay, benefits owed after WARN Act violation

Two of the 250 Patriot National employees laid off without severance pay on the day before Thanksgiving are suing their former employer in federal court.

Meanwhile, Patriot National’s ex-CEO is suing the company’s former attorneys and blaming them for its impending bankruptcy.

The laid-off employees’ suit, filed in U.S. District Court for the Southern District of Florida, seeks 60 days’ worth of unpaid wages, salary, commissions, bonuses, accrued holiday pay, accrued vacation pay, pensions, 401k contributions and health insurance benefits. The suit alleges those wages and benefits are owed because the insurance services provider violated the federal Worker Adjustment and Retraining Notification Act by not giving 60 days of advance notice of the employees’ impending terminations.

The suit seeks class-action certification and for plaintiffs Michelle L. Cole and Andrea Scarlett to be designated as class representatives. If class-action status is granted, other laidoff workers can be joined to the suit as co-plaintiffs.

“We have been contacted by more than two dozen former employees who have asked us to represent them as well,” said attorney Charles Ercole of the Philadelphia-based law firm Klehr Harrison Harvey Branzburg LLP, which is litigating the case with Fort Lauderdale-based Weiss Serota Helfman Cole & Bierman P.L.

Ercole specializes in claims based on the WARN Act, which requires employers with more than 100 employees to give 60 days’ notice of any plant closing or mass layoff involving more than 50 employees at a location. Failure to give the 60 days’ notice entitles the employees to wages and benefits they would have earned during the notice period, according to Ercole’s website, warnactlawyer.com.

Gex “Jay” Richardson, Patriot’s general counsel and executive vice president of administration, did not respond to an email seeking comment about the classaction suit.

According to the suit, all Patriot National employees “similarly situated” to Cole and Scarlett “worked at or reported to” the company’s headquarters at 401 E. Las Olas Blvd., Suite 1650, in downtown Fort Lauderdale. Cole was an audit billing specialist, and Scarlett was an assistant controller, the suit states.

Patriot National announced the layoffs on Nov. 22, the day before Thanksgiving, and said they would officially take effect on Black Friday.

Emails from the company to its laid-off workers said they would not receive any severance due to “financial difficulties.” Six days after announcing the layoffs, the company said it was being acquired by “certain funds and accounts” managed by its creditors in conjunction with a restructuring plan and petitions for relief under Chapter 11 of the United States Bankruptcy Code.

As of Dec. 19, Patriot National had not yet filed for bankruptcy, according to a search of the federal court system’s searchable records database.

Ercole said if Patriot National files for bankruptcy, the suit will be transferred to bankruptcy court “by filing an adversary complaint and/or a class proof of claim.”

Patriot National said the layoffs and reorganization plan became necessary after its largest customer, workers compensation provider Guarantee Insurance, was placed under state-supervised receivership in late November.