2 ITT Employees File Lawsuit Against School Over Federal Law Violation
Steve Ryan, a teacher for two locations, and Allen Federman, Carmel, Indiana’s ITT Educational Services Inc.’s business analysts, filed their complaints in Delaware’s U.S. District Court.
The suit is asking for class-action status for the for-profit’s 8,000 employees who are going to lose their jobs after the company decided to shut all of the 130 ITT Technical Institute campuses located in 38 states.
ITT said Sept. 6 that all of its campuses would close because it could not thrive after the recent sanctions put about it from the U.S. Department of Education.
According to the lawsuit, ITT violated the federal law “Worker Adjustment Retraining and Notification Act”, which states companies must give 60-days’ advance written notice of their intent to close their doors and lay off workers. The law is geared toward companies that have over 100 employees and business sites that have more than 50 employees. ITT Tech campuses that have less than 50 employees may not have to follow this law.
It also claims the layoff is in violation of California labor laws, which also denotes 60 days advanced notice of a mass layoff. ITT Educational has 15 ITT Tech campuses in that state.
The lawsuit requests that every affected ITT employee be compensated for unpaid pages, bonuses and salary commissions along with other benefits that they would have received during that 60-day period.
Nicole Elam, spokeswoman for ITT, said the campus closures is a complex process. It also said all matters that involve personnel and students are of the utmost priority.
Education Department officials banned the school from enrolling new students who used federal financial aid on Aug. 25. Officials claimed the company was a risk to both taxpayers and students. ITT was ordered to pay $152 million in 30 days to cover student refunds and liabilities if the school decided to close.
Kevin Mondany, CEO for ITT Educational Services, said the company was a regulatory assault victim and was not provided the opportunity to defend itself.