Department of Labor to investigate Akorn, pharma company that laid off 300 in Amityville
The state Department of Labor is investigating a company that last week closed and laid off 303 Amityville employees over the company’s failure to give adequate warning of the layoffs..
Akorn Operating Co. LLC, an Illinois-based pharmaceutical business with a longtime facility in Amityville, filed for Chapter 7 bankruptcy and abruptly laid off all its employees. The company shut down its operations Thursday, according to a Worker Adjustment and Retraining Notification, or WARN, filed with the Labor Department Wednesday.
In a statement issued Monday, the Labor Department said it "investigates all employers who fail to provide workers with sufficient notice under the WARN Act, and Akorn is no exception.”
Under the act, employers with at least 50 full-time employees are required to file a notice of mass layoffs or closures 90 days in advance. Federal rules require employers to file 60 days in advance.
Additionally, the Labor Department said, "Our Rapid Response team is working to support impacted workers to ensure they have unemployment insurance support and re-employment resources they need to get back on their feet.”
A state spokesperson said Monday that the Labor Department could not confirm whether it would fine Akorn or be able to collect back wages for employees as it does not comment on open investigations.
Businesses that fail to file a WARN in New York face a civil penalty of $500 per day of violation, meaning Akorn could potentially face as much as $45,000 in penalties for not filing 90 days in advance. Additionally, violators also may be liable for back pay and other benefits for 60 days of the violation, the state said in email.
Matthew Di Carmine, 35, a former chemist at Akorn, said the email he received from the state was inadequate and left him feeling less confident about the state’s ability to retrieve back wages.
“There’s actually no mention of being able to get my money back,” said Di Carmine, who lives in Farmingdale.
Because of the bankruptcy, Di Carmine said he’s not hopeful about obtaining back pay. An ongoing lawsuit might take years, making the situation more frustrating.
Impacted employees have filed a class-action lawsuit against the company over the WARN Act violation.
Akorn’s bankruptcy trustee will be responsible for responding to the lawsuit, said attorney Stuart J. Miller, a partner at Manhattan-based law firm Lankenau & Miller LLP, who is representing the laid-off employees.
“It’s very possible that in a Chapter 7 case, the only source of money in the estate [that’s not subject to secured creditors' liens] will be by way of actions the trustee may bring against other parties to recover money,” he told Newsday last week.
The state said impacted workers who haven't been contacted by its Rapid Response team should reach out to their Long Island Rapid Response Representative by visiting https://on.ny.gov/3xUmXev.