Medly Health Failed to Provide Proper Notice Before Mass Layoffs, Class Action Alleges

New to ClassAction.org? Read our Newswire Disclaimer

A proposed class action claims that Medly Health failed to provide mandatory advanced written notice of two mass layoffs impacting much of its workforce in August of this year.

According to the 11-page case, Medly Health, an online pharmacy, dismissed without notice an estimated 1,100 of its 1,850 to 1,900 full-time employees in two rounds of layoffs without written notice. Approximately 16 percent were laid off on August 4, 2022, with 50 percent of the remaining employees following on August 31, 2022, the suit claims.

Want to stay in the loop on class actions that matter to you? Sign up for ClassAction.org’s free weekly newsletter here.

As the complaint tells it, Medly Health violated the Worker Adjustment and Retraining (WARN) Act, which requires an employer to provide 60 days’ advance written notice before a “mass termination,” and the New York WARN Act, which calls for 90 days’ notice.

Moreover, the lawsuit claims that Medly Health failed to pay employees their respective “wages, salary, commissions, bonuses, accrued holiday pay and 401(k) contributions,” and that the company did not “provide them with health insurance coverage and other employee benefits” after the termination.

In general, a company must comply with the WARN Act if it employs 100 or more full-time workers, or if it employs 100 or more workers who work a minimum of 4,000 hours a week. Workers may be protected by the WARN Act if a mass layoff, occurring at a single employment site, terminates either 500 or more full-time workers, or 33 percent of full-time workers.

According to the filing, Medly Health provided WARN Act notice for the second round of layoffs after the workers had already been terminated. Per the complaint, Medly Health told workers that the layoff occurred “due to unforeseeable business circumstances,” in particular an “unexpected failure to consummate a [sic] significant financing” in mid-August and a subsequent failure to obtain “comparable alternative financing.”

The employees laid off on August 4 did not receive a notice, the suit says. Per the case, employees who were not laid off received raises, and on or about September 1 Medly’s CEO relayed that the company “had secured funding and financing from banks and investors.”

The plaintiffs, 12 laid-off employees, contend that Medly Health’s purported reasoning for the mass terminations is “disingenuous and false,” and that the layoff was “foreseeable.”

In light of these allegations, the plaintiffs, and similarly situated individuals seek to recover 60 days’ and 90 days’ of wages and benefits, pursuant to the federal and New York WARN Acts, respectively.

The lawsuit looks to cover anyone in the United States who was employed in any position by Medly Health or any of its affiliates for at least the 30 days prior to, or on the date of, the August 4, 2022, and August 31, 2022, mass layoffs and was terminated without cause.

Get class action lawsuit news sent to your inbox – sign up for ClassAction.org’s free weekly newsletter here.