# Paramount Global Confronts Class Action Lawsuit Amid Layoffs: Alleged Breach of WARN Act

Paramount Global, the entertainment powerhouse operating CBS, MTV, Nickelodeon, and Paramount Pictures, is confronting legal difficulties following a recent series of layoffs that have led to a class action lawsuit. The suit, lodged in a New York federal court on Thursday, accuses Paramount of breaching the Worker Adjustment and Retraining Notification (WARN) Act by not providing the legally mandated notice to employees prior to the termination of their jobs.

## The Claims

The lawsuit, initiated by former employee Julian Hagins representing over 300 other affected individuals, alleges that Paramount Global and its subsidiary CBS Interactive Inc. dismissed employees without the 90-day advance notice required under the WARN Act. The layoffs mainly impacted those who were based at or reported to Paramount’s headquarters located at 1515 Broadway in Manhattan and other nearby sites.

Ratified in 1988, the WARN Act serves as a federal legislation aimed at safeguarding workers by obligating employers to give advance notification regarding mass layoffs or plant closures. Specifically, it stipulates that companies with 100 employees or more must provide a 60-day notice prior to a mass layoff, while New York’s interpretation of the WARN Act necessitates a 90-day notice for companies with 50 or more employees. The lawsuit claims that Paramount did not meet these legal obligations.

### Essential Aspects of the Lawsuit:
– **Plaintiff**: Julian Hagins, a previous employee, leads the class action lawsuit.
– **Defendants**: Paramount Global along with CBS Interactive Inc.
– **Affected Employees**: More than 300 workers, predominantly from the Manhattan headquarters and surrounding areas.
– **Alleged Breach**: Failure to give the legally required 90-day notice under the New York WARN Act.
– **Possible Outcomes**: Paramount could be held liable for 60 days of wages and benefits for each impacted employee.

## The Layoffs

The layoffs in question transpired on September 24, 2023, as a component of a wider cost-cutting initiative undertaken by Paramount Global. As reported by *The Hollywood Reporter*, this marked the second phase of layoffs, with the company aiming to cut its U.S.-based workforce by 15% to achieve $500 million in savings. The layoffs are part of Paramount’s approach to refining operations and enhancing profitability in its streaming services while addressing shifts in its traditional media sectors.

Co-CEOs George Cheeks, Brian Robbins, and Chris McCarthy acknowledged the layoffs in a communication to employees, stating, “We are making attempts to boost streaming profitability while simultaneously adapting to the changing environment in our traditional sectors.” The memo also noted that the recent layoffs completed 90% of the company’s intended workforce reductions.

### Paramount’s Cost-Saving Approach:
– **Layoff Date**: September 24, 2023
– **Workforce Reduction**: 15% of U.S.-based employees
– **Expected Savings**: $500 million
– **Purpose**: To enhance streaming profitability and react to fluctuations in traditional media businesses.

## WARN Act Breaches

The WARN Act was established to protect workers by providing them with time to prepare for the financial and emotional repercussions of job loss. Under the federal WARN Act, businesses are obligated to give 60 days’ notice prior to a mass layoff or plant closure. However, New York’s version of the WARN Act expands this to a 90-day notice for firms with 50 or more workers.

The lawsuit contends that Paramount’s layoffs do not qualify for any exceptions outlined in the WARN Act, including “plant closing” or “unforeseen business circumstances.” Consequently, the company could face obligations to compensate affected employees with 60 days of wages and benefits, as specified in the New York WARN Act.

### Key Components of the WARN Act:
– **Federal WARN Act**: Mandates 60 days’ notice for mass layoffs or plant closures for companies with 100 or more employees.
– **New York WARN Act**: Requires a 90-day notice for entities with 50 or more employees.
– **Penalties for Non-Compliance**: Employers may need to pay 60 days of wages and benefits to impacted employees.

## Paramount’s Reaction

In light of the lawsuit, Paramount Global has refuted the claims, asserting its adherence to both federal and state WARN Act stipulations. In a statement, the company remarked, “Paramount employees entitled to Federal or State WARN notice receive it.” The company has not disclosed additional specifics regarding its defensive strategies against the lawsuit.

### Paramount’s Communication:
– **Rejection of Claims**: Paramount insists it complies with WARN Act obligations.
– **Legal Strategy**: The organization has yet to reveal specific legal defenses.

## What Lies Ahead?

As the lawsuit unfolds, it may have profound implications for both Paramount Global and