Former Employees get the last laugh over Corporate Greed.
“I don’t want to grow up, I’m a Toys ‘R’ Us kid. There’s a million toys at Toys ‘R’ Us that I can play with.” A jingle that is in the hearts of every 80s and 90s kid, but if you worked for the company, you might be singing a different tune. If you recall, on June 29th, 2018 the Retailer went out of business and with it, their employees were out of work and left them with no severance pay and no insurance. But a year later a group of 33,000 former employees got their chance to get the last laugh over their former employer thanks to a recent class-action lawsuit that was filed by a former employee named Ann Marie Reinhart Smith.
Ann Marie worked for the company for 30 years, she filed a Class-Action claim on the behalf of 33,000 employees who were laid off with no severance pay, there was a hardship fund set up by two of the three private equity firms behind Toysrus, KKR and Bain Capital; which ended up with $20 million. With this fund, there were several requirements that weren’t in a sense ‘traditional’ in terms of Severance Programs, this didn’t sit well with employees who were loyal to the Company. In a statement made by Ms. Reinhart Smith, she had this to say about it:
“After being so loyal to the company, to be let go without our promised severance is disrespectful, We’re grateful we achieved this class-action settlement. It’s an important milestone for working families like mine who are so vulnerable to Wall Street’s greed.”Ann Marie Reinhart Smith, Former Toysrus Employee of Toysrus.
The Judge presiding over the case, Keith L. Phillips of the District of Eastern Virginia approved the $ 2 million settlement on Thursday, part of the employee’s main case was that they were promised by the company that they would receive severance pay when liquidation plans were announced; but that would change when the company told its employees they would not receive any sort of payout.
“After nearly a year, employees laid off by Toys ‘R’ Us are finally getting something to show for their steadfast service, It’s a shame they aren’t getting more, but this settlement sends a message that employees deserve a place in the front of the line of creditors when businesses fail, and that is important to people who work in retail and their families.“Jack Raisner, Partner of the law firm of Outten & Golden LLP
Mentioned above, is a quote from Mr. Raisner who represented the former employees explained that the victory was a long time coming, though he wished it would have been more. Toysrus announced they would return with several stores but with a smaller presence. But with the recent actions of the Company in the treatment of their former employees when toysrus closed down, would the public want to shop or work for their establishment? In this writer’s opinon, the outlook looks grim.