Katerra employees file class action lawsuit over job losses

A Katerra installation (Katerra, Getty)

Reports surfaced on June 1 that construction startup Katerra was shutting down operations in the United States. Three days later, massive layoffs began.

Now, three former employees are suing a class action lawsuit against the construction start, alleging it failed to provide sufficient notice of their dismissal. The lawsuit, which seeks to certify a class of some 700 laid-off Katerra employees, has been filed as an adversary’s complaint in the Katerra bankruptcy case.

The employees worked in Seattle, Jersey City and Hayward, Calif., According to the lawsuit. Clifford Marvin worked as an architectural specification writer in Katerra’s Seattle office, while Todd Irving was construction superintendent on a Katerra project in Hayward. Joseph Russomanno was a help desk technician at the company’s Jersey City office.

Under the Federal Worker Accommodation and Conversion Notice Act, or WARN, employers with 100 or more employees must provide at least 60 days written notice of plant closures and layoffs. collective. There are a few exceptions, including “unforeseeable business circumstances”.

But Katerra’s financial problems date back several months, and the lawsuit alleges that Katerra was required to abide by those notification rules and owed employees unpaid wages and accrued vacation.

A representative for Katerra did not immediately respond to a message seeking comment.

Katerra filed for bankruptcy on June 6, listing liabilities between $ 1 billion and $ 10 billion and assets of only $ 500 million to $ 1 billion. It recorded losses of $ 2.78 billion in 2018, 2019 and 2020, according to the filing.

The company, which has struggled financially as well as struggling with its projects, plans to sell its operations in India and Saudi Arabia, as well as a number of companies it has acquired over the years. SoftBank, its largest funder, is providing a $ 35 million loan to help the company unwind its operations and market its assets.

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