Ex-worker claims Central Freight broke law in violation of WARN Act

Ex-worker claims Central Freight broke law by failing to give 60 days’ notice of its planned shutdown to nearly 2,100 employees and truck drivers, who found themselves without jobs two weeks before Christmas.

A former Central Freight Lines employee claims the Waco, Texas-based less-than-truckload (LTL) carrier violated federal law by failing to give 60 days’ notice of its planned shutdown to nearly 2,100 employees and truck drivers, who found themselves without jobs two weeks before Christmas.

Aaron Cox worked at the Waco facility until his employment was terminated on Dec. 13, the same day CFL officially told its employees and drivers that the LTL carrier was ceasing operations.

Cox alleges in his proposed class-action complaint that the company violated the federal Worker Adjustment and Retraining Notification (WARN) Act and did not provide at least 60 days’ written notice of a pending closure.

Ex-worker claims Central Freight broke law – Cox alleges in his proposed class-action complaint that the company violated the federal WARN Act and did not provide at least 60 days’ written notice of a pending closure.

In the suit, filed in the U.S. District Court for the Western District of Texas, Cox claims Central Freight failed to pay him and other employees their “wages, salary, commissions, bonuses, accrued holiday pay and accrued vacation pay for 60 days following their respective terminations.”

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The company also “failed to make 401(k) contributions and provide them with health insurance coverage and other employee benefits,” court documents allege.

Bruce Kalem, president of Central Freight Lines (CFL), did not respond to messages seeking comment.

Industry analysts and 3PLs say poor acquisitions and a lack of understanding of the LTL business model were key to CFL’s demise. Rival carriers were surprised CFL held on as long as it did as rumors have been swirling for years that the company was on the verge of going out of business.

Ex-worker claims Central Freight broke law – Industry analysts and 3PLs say poor acquisitions and a lack of understanding of the LTL business model were key to CFL’s demise.

CFL had 65 terminals at the time of its closure.

The day CFL officially announced its closure, Dec. 13, the company did file a WARN Act notice that 70 dockworkers, terminal employees and truck drivers at its facility in Charlotte, N.C., were losing their jobs.

“CFL has been actively pursuing capital, new business and restructuring and refinancing alternatives to allow it to avoid or postpone any potential facility closures: however, to date, such efforts have been unsuccessful,’’ CFL said in its WARN letter.

Alerting employees prior to ceasing operations “would have jeopardized its efforts to obtain the financing and new business it was actively seeking in an effort to avoid or postpone this facility closure,” according to the WARN letter.

(from Freightwaves)