“Unforeseen business circumstances,” was the phrasing used by the Board of Directors for United Furniture Industries when the board announced the fate of some 2,700 workers spread out over several states.

In emails and texts sent to workers around midnight on Monday, Nov. 21, the board told workers that they were no longer employed and that these actions were taken due to "unforeseen business circumstances."

This slightly altered phrase is an exemption under the Worker Adjustment and Retraining Notification Act or WARN, that allows a company to not abide by the Act. The exemption applies to closings and layoffs that are caused by business circumstances that were not reasonably foreseeable at the time notice would otherwise have been required, according to the U.S. Department of Labor fact sheet on the Warn Act.

"If an employer provides less than 60 days advance notice of a closing or layoff and relies on one of these three exceptions, the employer bears the burden of proof that the conditions for the exception have been met." the Act reads. "The employer also must give as much notice as is practicable. When the notices are given, they must include a brief statement of the reason for reducing the notice period in addition to the items required in notices."

Attorney Philip Hearn, who practices labor and employment law, told WTVA in Tupelo that the company violated the WARN Act. He questioned the company's use of that terminology that so closely resembles that found in the WARN Act.  

"I found it really kind of interesting when you looked at the message that United Furniture industry since its employees is saying that they were closing for unforeseen business circumstances ... typically what you find in a situation for unforeseen business circumstance it's an act of God like a fire or a tornado something that wipes out the physical plant there are some exceptions based on financing but that will be a very fact-intensive inquiry which we look forward to getting into in the in the litigation of this matter."

Hearn was one of the first to file a class-action lawsuit against the furniture company in federal court.

"This is one of the lowest things I have ever seen done," said Hearn told Daily Journal. "Three days before Thanksgiving. You can't tell me they couldn't have waited until the Monday after Thanksgiving to do this."

Three lawsuits were filed by Mississippi-based employees in the federal Northern District of Mississippi, where United’s Okolona, Miss., headquarters is located, according to Winston-Salem Journal.

Each employee lawsuit requests class-action status. The plaintiffs are Frances Alomari, Toria Neal, and William Poe. Included among the defendants in Neal’s and Poe’s lawsuits are “John Does 1-10.”

The Alomari and Neal lawsuit would cover all United employees, while the Poe lawsuit covers just Mississippi employees.

Although the majority of affected United workers are in Mississippi, it had five operations in the Triad, as well as in California.

Neal, who worked for United Furniture for more than eight years, alleges in her proposed class-action complaint that the company violated the federal WARN Act and did not provide at least 60 days' written notice of a pending closure.

In the suit filed in the U.S. District Court for the Northern District of Mississippi, Neal claims she and potentially thousands of other United employees received an email and/or text message “that it was terminating all of its employees effective immediately” just minutes before midnight on Monday.

Langston & Lott, based in Booneville, Mississippi, filed the first class action against United Furniture Industries, Inc., alleging it violated the WARN Act when terminating all 2,700 of its employees. Jack Simpson, attorney for Langston & Lott, told FreightWaves.com.

“Under the WARN Act, the employees of United Furniture were entitled to either a 60-day notice or 60 days of severance pay — neither of those were provided,” he told the supply chain magazine.  “If appointed class counsel, we look forward to vigorously investigating the actions of United Furniture and seeking as much compensation the terminated employees are legally entitled to.”

According to the Salem-Journal, Commerce Department spokesman David Rhoades said the department has not received a WARN notice from United as of Friday (Nov 25). Winston-Salem Mayor Allen Joines also said his office had not received a notice.