2012 Fisker Karma EcoSportEnlarge Photo
The last few weeks have made painful reading for fans of electric car startup Fisker Automotive.
It seems fate has a few more nails to bang in to Fisker's coffin. Automotive News reports the company is now facing a federal lawsuit from 160 employees laid off on Friday, for breaking laws requiring companies to give adequate notice before mass dismissals.
The lawsuit adds to a litany of problems at Fisker over the past year, from the destruction of more than 300 Fisker Karma sedans at a superstorm Sandy-ravaged port, through stalled production, and the departure of founder Henrik Fisker.
This was followed with Fisker putting 160 employees on "temporary" furlough in recent weeks to save cash--and Friday saw Fisker lay them off for good--around 75 percent of Fisker's 210-strong workforce.
The employees have reportedly been given no severance pay, only compensation for unused vacation days. According to the U.S. Worker Adjustment and Retraining Notification Act (WARN), companies must give employees at least 60 days notice for terminations, a condition Fisker Automotive hasn't met.
Fisker has also violated local laws, according to the suit--failing to notify California's Employment Development Department, the local workforce investment board, and the top elected officials in Anaheim and Orange county of the layoffs.
The case has been filed by law firm Outten & Golden LLP--the same firm that won a successful $3.5 millio settlement against failed solar company Solyndra.
Filed in U.S. District Court in Santa Ana, California, the suit also says the company has failed to pay employees the wages and other benefits they would have earned in the 60 days following the layoffs. It isn't yet clear how much the dismissed employees are entitled to in damages, though the suit is seeking compensation equal to the wages, salary, bonuses and benefits each employee would have been entitled to over the period.
Fisker will need to prove it meets the WARN Act's exceptions rule, in which the 60-day period doesn't apply for "faltering companies" and through "unforseeable business circumstances".
Even if Fisker can meet those conditions, the company isn't out of the water yet. Loan repayments, a skeleton staff and little sign of production restarting all point to a rather bleak future for the once-vaunted startup.