Beverage manufacturer Joriki Beverages announced that it closed its packaging facility in Pittston, Pennsylvania. Local station Newswatch 16 reported that the company notified its 229 affected workers of the immediate shutdown on New Year’s Eve through email.
Joriki stated in the WARN notice that it could not provide the traditional 60-day warning. The company explained that it had been working for several months on a going-concern transaction it thought would sustain operations at the Pittston plant and avoid job losses.
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The company added that it received financial support from a major customer and primary lenders as it pursued a transaction and believed issuing a WARN notice 60 days prior to the termination date would have compromised its plans to find a buyer or retain funding.
Joriki revealed that a deal with a potential buyer fell through days before Christmas. The company described the failed deal as “sudden, dramatic and unexpected” and led to a financial crisis that it could not address without closing the Pittston facility.
Federal law requires employers who are planning mass layoffs or a plant closure to notify affected employees at least 60 days before the action.
However, Action 16 cited the Pennsylvania Department of Labor and Industry, which stated that employers can claim an exemption to the law if specific conditions apply, including “unforeseen business circumstances or a faltering company.”
The “faltering company” exception applies to companies that were seeking capital or business when a 60-day notice would have been required and to those that felt that providing the required notice would have precluded it from securing the necessary capital or business.
Still, Joriki must demonstrate to the U.S. Department of Labor that it qualifies for the exception. Industrial Media has not received a response to its request for comment from Joriki.
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