In early February, Earth Fare announced it would be closing all of its stores, likely meaning each of its 3,000 employees would be laid off. In response, two employees of the Asheville-based grocery store chain filed a class-action lawsuit alleging Earth Fare violated the Worker Adjustment and Retraining Notification Act (the “WARN Act”). Generally, the WARN Act requires employers with at least 100 employees to provide at least a 60-day advance written notice of plant closings and mass layoffs; however, the likelihood of success of the plaintiffs’ claims will be determined by the specific definitions provided in the WARN Act, as well as its exceptions and exemptions. The WARN…
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North Carolina Business Court: Employment Agreements Automatically Terminate Upon the Sale of a Company
A recent decision by the North Carolina Business Court held that an employment agreement automatically terminates upon the asset sale of one company to another, despite continued employment with the purchasing company.[1] In 2001, Andrew Lund executed an employment agreement with his then-employer, Southern Staircases of North Carolina, Inc. The agreement contained several post-employment restrictions regarding disclosing confidential information and soliciting current and future customers. The agreement also contained a duty of loyalty provision to “devote his entire working time, attention, and energies to the business of the Company and . . . [to] not be engaged in any other business…
