American Apparel Inc.’s recent layoffs of nearly 200 workers have sparked another backlash from employees, this one in the form a lawsuit against the downtown L.A. apparel maker.
Los Angeles attorney Keith Fink, legal counsel to American Apparel founder and former Chief Executive Dov Charney, filed a lawsuit Thursday in the U.S. District Court for the Central District of California on behalf of laid-off employees alleging the company violated the federal and state Worker Adjustment and Retraining Notification, or WARN, laws, when it laid off employees this month. The law requires that certain employers notify employees 60 days ahead of pending layoffs.
According to the complaint, employees were given only one or two days’ notice before the layoffs and that the company attempted to mislead them by providing separation agreements only in English to employees who spoke only Spanish. Workers also allege they were required to sign separation agreements immediately or else lose severance pay. By signing the forms, employees agreed they wouldn’t seek claims against American Apparel for severance pay and WARN-related issues, according to the complaint.
The suit seeks 60 days’ pay, past-due wages, back pay and benefits for the laid off workers, and calls for the separation agreements they signed to be revoked.
In a letter, dated Thursday and obtained by the Business Journal, American Apparel Chief Executive Paula Schneider said there is no law “that required American Apparel to give more notice than it did,” and that no employee “was required to sign anything whatsoever in order to receive his or her final wages.”
Through its public relations firm, American Apparel declined to comment about the lawsuit.
Fink, a partner at West L.A. law firm Fink & Steinberg, also recently filed new complaints with the National Labor Relations Board on employees’ behalf, alleging American Apparel, through security guards and other employees, have violated the federal labor rules by interfering with workers who have formed a group pushing for union representation. The group formed with the help of Hermandad Mexicana, a Santa Ana non-profit that advocates for immigrants’ rights, and with support from Charney.
One of the complaints alleges that the company interfered with employees’ rights when in March it said it would pay workers for sick days, offer better medical benefits and add a 401(k) plan, all after workers began unionizing.
“In short, in the middle of union-organizing efforts, you cannot offer employees promises of better pay and bonuses,” Fink said. “They really did it to try and persuade the employees from joining a union.”
Fink said he represents factory workers to top level management in claims.
In a statement, a spokeswoman for American Apparel said the claims are without merit.
“Workers’ rights and respect for our employees are core principles of American Apparel,” the statement said. “This is clear from our Code of Business Conduct and Ethics, which reflects our efforts to ensure that American Apparel’s workplaces are free from harassment, bullying and intimidation, and which promotes fair treatment of employees and compliance with labor and employment laws. We are dedicated to a culture of free speech and social commentary.”