Flexsteel Industries has agreed to pay $1.3 million to settle a lawsuit filed by employees laid off when plants in Dubuque and Mississippi closed, according to BloombergLaw.com.
If approved, about 300 former employees would receive payments ranging from less than $1,000 to “just over $15,000,” depending on a range of factors.
In March, the former Flexsteel employees alleged the Iowa-based company used the pandemic to collect millions in federal aid while newly installed executives enriched themselves and denied severance pay to hundreds of laid-off, long-term workers.
The plaintiffs claim the Dubuque-headquartered company has violated the Iowa Wage Payment Collection Act, as well as the federal Worker Adjustment and Retraining Notification Act of 1988 and Employee Retirement Income Security Act of 1974.
According to the Iowa Capital Dispatch newspaper, the workers allege that when the pandemic hit in early 2020, Flexsteel undergoing corporate restructuring that would leave plants in California, Arkansas, Mississippi and Iowa shuttered. Up until that time, the company had allegedly been providing workers with 60 days’ notice of their termination in accordance with Worker Adjustment and Retraining Notification Act of 1988, and with severance pay in accordance with the Employee Retirement Income Security Act of 1974.
In May 2019, for example, the company closed its California plant that produced residential furniture, and allegedly gave its 87 workers 60 days’ notice and severance pay. A few weeks later, notice and payouts were provided to 109 employees as an Arkansas plant that was preparing to close.
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