Fortunoff is owned by NRDC Equity Partners, Purchase, N.Y., which purchased the retailer in February, 2008, after it filed for bankruptcy for the first time.
A spokeswoman for NRDC told Newsday that Fortunoff is still in the selling process and is looking for a buyer and confirmed the layoffs.
The affected workers told Newsday they were not given severance packages and several criticized the company’s handling of the cuts as chaotic and confusing, with little information provided about options for health care.
The company said all laid-off employees are eligible for COBRA, the continuation of insurance coverage, but many said they received conflicting information, Newsday reports. One woman who worked at the company for almost 30 years said she was told she would not have COBRA as an option. Others were skeptical the company could avoid liquidation and said there would likely be no company health care plan for them to access through COBRA.
Fortunoff, which has set a Feb. 23 auction date to sell the company, also faces a class action suit filed Thursday by former employee Joanne M. Iannacone, Newsday reports. The suit claims the company failed to provide the advance written notice of a mass layoff that is required by the federal and state Worker Adjustment and Retraining Notification acts. Employees are asking for 60 days of wages, salaries, and other benefits.