Workforce

California Red Lobster employees sue chain over mass layoffs

A lawsuit alleges that the seafood chain did not give staff enough notice before closing nearly 100 restaurants last month.
Red Lobster
The suit accuses Red Lobster of violating the WARN Act. | Photo: Shutterstock

California Red Lobster employees who lost their jobs in a wave of sudden closures are suing the company, claiming they were not given proper notice of their impending unemployment.

A proposed class-action lawsuit filed last month in Florida bankruptcy court accuses the seafood chain of violating the WARN Act, which requires businesses to give employees 60 days’ notice of a mass layoff or closure.

Orlando-based Red Lobster on May 13 abruptly closed 93 struggling locations across the country, including a number in California. It filed for Chapter 11 bankruptcy a week later. In a bankruptcy filing, the chain said it tried to relocate employees to nearby Red Lobsters where possible.

The roughly 300 people who worked in the closed California restaurants were immediately let go without notice, according to the lawsuit. It is asking that Red Lobster be ordered to pay the workers the 60 days’ worth of back wages and benefits they are owed under the WARN Act.

Red Lobster had not responded to a request for comment as of publication time.

The 570-unit chain filed for bankruptcy on May 19, blaming inflation pressures, burdensome leases and mismanagement. It has struggled for years with sales declines, including a decrease of more than 8% in 2023, according to Technomic.

And it may not be done closing restaurants. Its bankruptcy filing includes a list of 228 locations that could close if it’s unable to renegotiate their leases. Some of them were already closed as part of the May 13 sweep.

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