Former employees of MF Global have filed separate WARN (Worker Adjustment and Retraining Notification) class-action suits against MF Global Holdings Ltd., the parent company, and various entities on behalf of themselves and employees laid off last Friday.
The suits, filed in U.S. Bankruptcy Court in Manhattan, allege that MF Global failed to provide 60 days notice of layoffs as required under federal law, and also under the New York WARN Act, which mandates companies give 90 days notice.
In one of the suits, Todd Thielmann, a former floor broker in Chicago, and Pierre-Yvan Desparois, a vice president in credit risk management in New York, are claiming in excess of $25 million in damages as a result of the firings, which took place following the bankruptcy filing of MF Global Holdings Ltd. Oct. 31.
"It's important to note that the lawsuit was filed against the holding company, MF Global Holdings Ltd., and not the broker-dealer," said Kent Jarrell, spokesman for the trustee's office that fired the employees and is liquidating the unit. "However, the trustee acted appropriately in connection with the termination of employees as part of the court-mandated liquidation and wind down of MF Global Inc."
Charles Ercole, one of the lawyers for the plaintiffs, said they plan to amend the lawsuit to make clear that one of the defendants is in fact the broker-dealer, MF Global Inc.
The plaintiffs are suing for wages, salary, commissions, bonuses, accrued holiday pay, pension, healthcare and other benefits for 60 days (and for 90 days under the New York WARN lawsuit).
Another employee, Natalie Sivova, also filed a WARN class-action suit today on behalf of herself and other "similarly situated" employees who were fired within 30 days of November 11, 2011. The lawsuit was brought against the parent company and two entities, including the broker-dealer, and seeks to recover 60 days of wages and benefits.
The third lawsuit was brought by Anthony Abruzzo, who worked in New York and was laid off last Friday, on behalf of himself and other employees who were terminated on or near that date. The lawsuit asks for wages and benefits for 60 days.
Employees can sue for eight weeks of pay and benefits to make up for the time they would have had to scout for a new job, said Jack Raisner, an employment lawyer at New York-based law firm Outten & Golden LLP.
MF Global employees may be able to benefit from the fact that their terminations occurred after the company declared bankruptcy. Their claims for WARN pay would be grouped with administrative expenses, so they'd get paid at the same time as the lawyers handling the bankruptcy, Raisner said.
Even if the plaintiffs win, however, they'll have to share their winnings with the employment lawyers, who can take up to a 30% cut of any damages awarded, an employment lawyer familiar with the matter said.
Write to Julie Steinberg at Julie.Steinberg@dowjones.com