Former employees who were laid off as a result of Rubio’s Restaurants Inc. closures have filed a complaint saying the fast-casual chain violated both federal and California notification requirements.
Plaintiff William Verran is seeking class-action status in the complaint filed last week in Rubio’s ongoing Chapter 11 bankruptcy case, saying he and other workers were not given fair notice before their employment was terminated in June.
The Rubio’s Coastal Grill chain closed 48 underperforming restaurants in California and filed bankruptcy, blaming the high cost of doing business in the state. But Rubio’s sales have been slipping for years.
It was the second bankruptcy for the chain—a reorganization was also filed in 2020 during the pandemic. Now with 86 restaurants, Rubio’s unit count has been in decline since 2017.
The Worker Adjustment and Retraining Notification, or WARN, act requirements in California are stricter than the federal standard. The state requirement applies to employers of 75 or more workers. If 50 or more employees within a 30-day period are laid off as a result of plant closures, employers must give 60-days notice.
In the complaint, Verran, a former worker at a restaurant in Roseville, California, contends he and others were terminated on or around June 5, without any notice. On behalf of himself and the group, he is seeking 60 days back pay and benefits, as well as to be recognized as a higher priority claim within the bankruptcy proceeding.
The company could also potentially face penalties.
Rubio’s officials declined to comment, except to say that they disagree with the claims in the complaint.
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