Former employees of bankrupt less-than-truckload (LTL) carrier New England Motor Freight (NEMF) have dropped their lawsuit charging the company violated federal law by failing to give adequate notice of mass layoffs, the attorney representing a class of terminated NEMF workers confirmed today.
The suit was dropped after Elizabeth, New Jersey-based NEMF reportedly agreed to grant enhanced severance benefits to about 2,500 former workers. Workers will receive at least 14.5 days of severance, and could be granted severance beyond that period depending on the number of vacation days accrued. The initial package called for two weeks of severance. Workers will be provided health benefits for a near two-month period ending April 13. The new package adds $2.7 million to the original severance total. The information was first reported in Transport Topics.
The class-action suit against NEMF was filed just days after the carrier announced on February 11 that it would file for Chapter 11 bankruptcy protection and wind-down its operations. The suit alleged that NEMF violated a 1988 statute requiring employers with 100 or more employees to give 60 calendar days notice of plant closings and mass layoffs. NEMF employed 3,540 people.
Charles A. Ercole, the Philadelphia-based attorney representing the employee class, said at the time the suit was filed that approximately 350 drivers and other workers had signed up across nearly all of the 15 states and 35 terminals where the carrier operated. Ercole had said he was seeking class status for all affected NEMF employees. The suit had demanded eight weeks of pay and benefits.