In The News

Judge rules Arrow Trucking violated WARN Act

Shutting down abruptly and without notice on Dec. 22, 2009, has landed Arrow Trucking in yet another round of legal trouble in its bankruptcy proceedings.

Judge Terrence L. Michael of the U.S. Bankruptcy Court for the Northern District of Oklahoma ruled July 15 that the motor carrier violated the federal WARN Act when it shut down its offices and discontinued operations without any notice ahead of time.

That ruling has moved former employees up on the food chain of creditors, making their wage claims “priority claims.”

The shutdown of now-defunct Arrow Trucking of Tulsa, OK, left more than 1,400 employees and truckers without jobs. When the company ceased operations, many drivers were stranded on the road with no way to get home.

The Worker Adjustment and Retraining Notification Act – dubbed the WARN Act – requires companies that employ more than 100 people to give employees notice of closure and termination of their employment at least 60 days before closing.

Bankruptcy Trustee Patrick J. Malloy III filed papers with the court in early July requesting the court rule that Arrow Trucking officials violated the WARN Act. Even though the deadline had passed for employees to file wage claims against the trucking firm, Malloy contended a violation of the WARN Act would open the door for employees to file “priority claims.”

He has requested that a mailing be sent out to former employees “advising them of their rights under the Act and affording them the right to either file original claims or amend their existing claims to include WARN Act damages.”

Judge Michael agreed with Malloy’s request, ruling the trucking company had violated the WARN Act, and also granted Malloy’s request to notify former Arrow employees by mail of the decision and the opportunity to file wage claims.

By ruling that the employees – including company drivers – can now file “priority claims,” they can file a claim any time up until the case is closed, Malloy told Land Line.

However, Malloy said employees who have not filed the claims with the court might be interested in doing it sooner rather than later, as he is planning to have an interim distribution on wage claims by the end of the year.

[email protected]

Staff writer Clarissa Kell-Holland contributed to this report.

www.LandLineMag.com