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DECATUR, Ill. (NEXSTAR) — The Illinois Department of Labor will open an investigation into Akorn Pharmaceuticals “immediately,” according to a spokesperson.
The state agency will be focusing on apparent violations of the state’s WARN Act.
The law requires businesses with over 75 employees to give employees, local government and state government at least 60 days’ notice of mass layoffs or plant closures.
WCIA independently confirmed that no notice was given to any of the three ahead of the announcement.
“WARN exists in order to coordinate resources and support for employees impacted by layoffs,” a spokesperson for the Department of Labor and the Department of Commerce and Economic Opportunity said in a statement. “Not only did the company fail to submit a WARN notice to the State, it gave its hardworking employees only 24 hours’ notice of permanent layoffs, which is inconsistent with industry best-practices and lacks basic consideration for their employees. The Illinois Department of Labor will initiate an investigation immediately.”
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Instead, employees learned they would lose their jobs through a video call Wednesday morning. The company announced they would be providing no severance pay, and employees would lose their benefits, as well.
“It’s totally devastating to our community,” Rep. Sue Scherer (D-Decatur) said. “I know, first of all, I’ve already talked to the mayor about this, just since I heard which has just been, you know, this morning, and we’re looking into it, there’s a possibility that they’ve broken the law here.”
Employers who violate the WARN Act are subject to civil penalties, and the law does outline a potential scenario where employers would have to give backpay and benefits for the period of violation — up to 60 days.
It’s unclear if the state would be able to reclaim the money needed to give employees that backpay since Akorn intends to file for Chapter 7 bankruptcy.
In a joint statement from the Department of Labor and the Department of Commerce and Economic Opportunity, a spokesperson said “if violations are found, the Department will assess civil penalties against the company,” but made no mention of the other penalties.
