Paramount Global Faces Legal Action Over Layoffs

Paramount Global is in hot water as it tackles a new class action lawsuit over extensive layoffs that hit over 300 employees without the appropriate advance notice required by law.

Lawsuit Details and Allegations

The lawsuit, lodged in a New York federal court on Thursday, contends that Paramount infringed upon New York's Worker Adjustment and Retraining Notification (WARN) Act. This legislation mandates that companies provide at least 90 days' notice before conducting widespread layoffs. Paramount's legal troubles arise after it embarked on what it called 'phase two' of its layoffs on September 24, seeking to trim down 15% of its U.S. workforce to realize $500 million in cost savings.

Company's Response

In response to the allegations, a spokesperson for Paramount argued that the company did comply with federal and state WARN notice requirements, asserting, 'Paramount employees entitled to Federal or State WARN notice receive it.'

Impact of Layoffs

The sweeping job cuts have left a significant mark on Paramount, following a first round of layoffs the previous month that included the closure of Paramount TV Studios and the exit of prominent executives. The recent layoffs affected approximately 295 employees from the New York headquarters, along with at least 50 from nearby worksites, all effective on September 30.

Plaintiffs' Demands

The plaintiffs’ complaint aims to secure wages, salaries, commissions, bonuses, accrued holiday pay, and other benefits for a 60-day period, which these former employees argue they are owed due to the alleged failure to adhere to legally mandated notices.

WARN Act Requirements

Under the federal WARN Act, employers with 100 or more employees must provide notice if layoffs impact more than 500 staff members. Additionally, states like California impose even stricter requirements, necessitating notice for any layoffs affecting 50 or more workers, provided the company has at least 75 employees. In New York, a notice is required if layoffs affect one-third of the workforce or 250 employees at a single location.

Potential Consequences

The consequences of violating the WARN Act can be severe, with potential penalties including back wages, benefits, and additional civil penalties for the employer. This legal battle is symptomatic of broader challenges within the media industry, which continues to grapple with a fast-evolving landscape, particularly in the realm of streaming services.

Conclusion

Stay tuned for updates on how this case unfolds, as more details about the repercussions of these layoffs could emerge in the near future!