Employees Suing Earth Fare Over Layoffs

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Employees Suing Earth Fare Over Layoffs

By Gina Acosta - 02/07/2020
Employees Suing Earth Fare Over Layoffs
Earth Fare announced on Feb. 3 that it would close all of its stores and begin inventory liquidation immediately, becoming the third U.S. grocer in recent weeks to seek a sale or shut down

Employees of bankrupt grocer Earth Fare are suing the Asheville, N.C.-based retailer for what they say is a violation of the Worker Adjustment and Retraining Notification (WARN) Act.

According to the Tampa Bay Times, the employees have filed a class action claiming that they weren't give the 60-day layoff notice required by law when Earth Fare told them they were losing their jobs. The WARN Act requires employers with more than 50 employees to give them written notice 60 days ahead of closures and mass layoffs.

Progressive Grocer did not receive a response after reaching out to Earth Fare for comment.

Earth Fare revealed on Feb. 3 that it would close all of its stores and begin inventory liquidation immediately, becoming the third U.S. grocer in recent weeks to seek a sale or shut down.

Earth Fare operates about 50 stores. The chain said that all employees had been notified of the impending closure of the company's stores and corporate office, but did not specify when the notification occurred. 

At a time when the food retail industry is crowded with everyone from Amazon to dollar stores selling natural foods, Earth Fare had positioned itself as a grocer aiming to raise food industry standards. Earth Fare sells foods and products that the company says are free of hormones, antibiotics, preservatives and artificial ingredients. The grocery chain boasts more than 4,000 non-GMO items store-wide, with more than 1,000 gluten-free products and a wide assortment to meet other dietary needs as well. Over the course of the past few years, the company had also implemented numerous strategic initiatives aimed at growth and expansion and enhancing the customer experience.

"While many of these initiatives improved the business, continued challenges in the retail industry impeded the company's progress as well as its ability to refinance its debt. As a result, Earth Fare is not in a financial position to continue to operate on a go-forward basis. As such, we have made the difficult but necessary decision to commence inventory liquidation sales while we continue to engage in a process to find potential suitors for our stores," the company said.

In recent weeks New York City-based Fairway and Boulder, Colo.-based Lucky's Market have both filed for Chapter 11 bankruptcy protection.

Fairway has entered into agreements with buyers for up to five of its 14 stores, and said that it will look for buyers for its other locations, which are in the New York metro area.

Meanwhile Lucky's has entered into an asset purchase agreement with a group led by company founders Bo and Trish Sharon for the seven locations (out of a footprint of 39 stores) that will continue to operate under the banner.